Weekend Open Discussion

This is the time and place to post observations about your local areas, comments on news stories or the New Jersey housing market, open house reports, etc. If you have any questions you wanted to ask earlier in the week but never posted them up, let’s have them. Also a good place to post suggestions, requests for information, criticism, and praise.

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Dechert confirmed Thursday that it has laid off more attorneys and staff because of the slowing economic conditions.

A source familiar with the situation said roughly 25 associates from various offices were affected along with a number of paralegals.

“We had laid off a number of people,” a Dechert spokeswoman said but the firm did not provide an exact number. “These layoffs include attorneys from across several areas and offices at various experience levels. We have also laid off a number of staff. We are matching our resources to what we believe our needs will be going forward.”

The Philadelphia-based firm has cut more than 200 people in four separate layoffs since December. The firm cut 72 of its 570-strong U.S. support staff on Dec. 16, and then 19 nonpartner lawyers on Feb. 12 and 10 staff attorneys on Feb. 25. And in March, it laid off 125 lawyers and staff firmwide, including 63 lawyers

The U.K. economy shrank more than twice as much as economists forecast in the second quarter as a record annual slump in construction, banking and business services kept Britain mired in recession.

Gross domestic product contracted 0.8 percent from the first quarter, the Office for National Statistics said today in London. Economists predicted a 0.3 percent drop, according to the median of 32 forecasts in a Bloomberg News survey. From a year earlier, the economy shrank 5.6 percent, the most since records began in 1955.

The housing market in the Trenton area and across the nation has begun to recover from the most far-reaching crisis since the Great Depression, according to recent data.
…
“The tide is turning,” said Jeffrey Otteau, a housing expert based in East Brunswick who tracks New Jersey real estate. “We’re not in a housing market where we have returned to the glory days of rapidly rising prices and homes selling in a matter of days or hours, but it does appear that we have seen the bottom to the housing market, which is very good news for the economy. ”
…
The pace of housing sales typically quickens in summer months, but sales this June were greater than a year ago. Mercer County saw 14 percent more contract sales in June 2009 compared to June 2008, according to Otteau’s figures.

In Burlington County, contract sales also picked up last month, according to the data from Otteau. While contract sales in May 2009 were 20 percent below levels in May 2008, sales in June 2009 were on par with the prior year.

“The market’s great, we’re very busy; it’s like old times,” said Roxanne Gennari, a sales associate at Coldwell Banker in West Windsor.

he final step of a three-part federal minimum wage increase takes effect Friday, and labor officials say it will stimulate the economy while businesses groups warn it could hurt some of the workers it was meant to help.

Labor Department Secretary Hilda Solis said the 70-cent-an-hour increase increase will “really improve and stimulate our economy,” adding more than $100 a month to low-wage workers in about 30 states. That should help more workers pay utility bills and buy groceries in an economy that needs a boost, Solis said in a conference call today.

The final 70-cent-an-hour increase raises the base wage to $7.25 from $6.55. About 20 states already have minimum wages that match or exceed that. Before the Fair Minimum Wage Act of 2007 was enacted, the federal minimum wage stood at $5.15 an hour.

The U.S. Chamber of Commerce warned it could backfire by putting further burdens on employers who are grappling with a tough economy. “Businesses in general, and small businesses in particular, are really struggling overall,” said Marc Freedman, the Chamber’s executive director of labor law policy. And instead of helping all workers, it could hurt some of them, he said.

“If you’re paying more for an employee, you need that employee to do more, so the idea of hiring entry-level unskilled workers is going to be less attractive,” he said. He added that employers’ search for extra revenue to pay the higher wages could lead them to cut back the hours an employee works or reduce benefits.

Gilly, who earns minimum wage, had no idea that starting today, she will be entitled to a raise. “Really?” she said, pausing mid-wipe.

The federal minimum wage increases to $7.25 an hour from $6.55. The raise is the final part of a three-step hike Congress passed in 2007 when the minimum wage was $5.15 an hour.

In Pennsylvania, New Jersey, and Delaware, where the minimum wage already was $7.15 an hour, the 10-cent increase to $7.25 is less steep.
…
Kevin Shivers, Pennsylvania state director of the National Federation of Independent Businesses, said the increase will hurt businesses that already are struggling and may discourage hiring.

“Right now, the biggest challenge facing small businesses is cash flow,” Shivers said. “The 10 cents may not be significant, but in the context of possible increased taxes and the fact that people aren’t buying, it is a problem.”

Nationally, the increase amounts to 10.7 percent and comes at a time when average hourly earnings have increased 2.7 percent annually, according to the U.S. Labor Department. Locally, the 10-cent increase equals a 1.2 percent pay hike.

the minimum wage should be indexed to inflation. I understand the economic argument against it, but you also have to look at the social effects. We expect people to support families on McD’s wages and then complain about the depredation of american society in urban areas????

Yes i t would drive prices up overall, but that is probably needed anyway is bound to happen for a number of reasons at this point.

Sitting where most of us sit incomewise, it is hard to object to a rise in the minimum wage especially since after this increase it likely has less spendong power than the minimum wage 40 years ago. Still, the thing that would likley help the low wage earners in this country the most would be a steep increase in wages in Asia.

Re: Dwek
This story just keeps on getting juicier. Isn’t that like a cockroach topping a rat cake?

In other news: Spain unemployment reaches 17.6%. Ouch.

Annectode: While bicycling through Loch Arbour Village yesterday, there are hundreds of lawn sigs all over town pleading: “Gov. Corzine, Please Help Loch Arbour”.
Property owners must be soiling themselves with the anticipated tax hike.

I’d agree if I wasn’t certain that this would lead to even more pressure to jury rig whatever inflation stats were being used.
I would like to see a small area; city, county, maybe state, completely abolish the minimum wage to see the affects. I suspect the min wage artificially skews wages lower for many. You’d probably get a big drop at first and then a slow steady rise to attract labor. Just speculation.

Index my ass. The damn minimum wage needs to stay right the hell where it is. I’m not looking to pay a damn cent more for my fruit, besides, no minimum wage earner is in a position to help the real estate market nor did they try to. Call me selfish and uncaring if you want to. I don’t give a shlt.

7.kettle1 says:
July 24, 2009 at 6:57 am
Grim,

the minimum wage should be indexed to inflation. I understand the economic argument against it, but you also have to look at the social effects. We expect people to support families on McD’s wages and then complain about the depredation of american society in urban areas????

Yes i t would drive prices up overall, but that is probably needed anyway is bound to happen for a number of reasons at this point

If I was in DC, you better believe this mess would get straightened out real quick. The stinking bleeding heart liberals like Kettle would be run out of town on a rail and we would truly go in small government mode. I’d make the damn government so small, that it would feel like we didn’t have a damn government

364.sas says:
July 23, 2009 at 11:59 pm
reinvestor101,

why don’t you take up residence in DC?
we could use your ideas and vigor.

SAS

365.sas says:
July 24, 2009 at 12:01 am
and you should go into the bulldozer biz.

The experiment you suggest would be very interesting. it would probably take years to see the long term effects and not just transition effects.

My other thought is that while such an idea should work according to economic theory, I suspect that due to the globalization of business even on the local level, that we would not see the effects you suggest. Since even small towns are often served by global corporations there would be little pressure to push income higher for the lowest paid jobs. The McD’s jobs are indirectly competing with indian and asian labor rates.

The only way the labor rates would be pushed up is if there was some competitive force driving them. As you suggested a wage increase in Indian and Asian markets could produce such an effect, but if McD’s decides to cut wages to 3$/hr what drives it up? Many entry wage (Minimum wage) jobs markets essentially have a captive labor pool due to the lack of alternative employment. As long as the employers have an essentially captive labor pool there is no force available to increase wages.

What it might do is act to drive more people to the military as, at the entry wage level, if wages start going down, the military is one of the few options which would allow you to make more then the commercial market is offering.

That starts to look like the late roman empire at that point. ALL HAIL CAESAR

I’d agree if I wasn’t certain that this would lead to even more pressure to jury rig whatever inflation stats were being used.
I would like to see a small area; city, county, maybe state, completely abolish the minimum wage to see the affects. I suspect the min wage artificially skews wages lower for many. You’d probably get a big drop at first and then a slow steady rise to attract labor. Just speculation.

Word is the Hon Peter Cammarano will refuse to resign and take a leave of absence. He supposedly is going to appoint one of his directors to run the city on rolling 30 day basis. If you live in Hoboken I beseech you to write, call, email the Governor to pressure him to not let this happen.

#21 – Even a global corp would have to sustain its local operations via local sales. The decrease in wages (to match China/India/Fla) would lead to a local sales decrease. That’s pretty logical. Either said global corp would have to pull out of that market or lower costs. This is assuming a lot but without that equilibrium you’d have artificially lower prices to match low wages being supported by higher wage areas, which may not be sustainable.
If they pull out, in theory at least, you’d have an opportunity for a local business w/ sales at prices supported by local wages, whatever they may be.

“America’s previously neutered accountants — traditionally, green-visored chickenshit-cowards who have rolled over for their belly rubs from America’s CEOs and CFOs, giving them all of the bullshit they asked for over the past 2 decades — seem to be developing a spine of sorts.”

Another angle to consider re the Criminal Complaint against Cammarano is the washing of bribes and turning them into “legitimate” campaign contributions. It’s clearly why Dwek was insisting that there be “no conflicts” shown from the money and the morons in Cammarano’s campaign bit hook line and sinker. Simply put the politician is given bribe money for his campaign as cash, that cash is given to a strawman donor (i.e. a political buddy from another town, a close relative, a friendly business) who then writes the campaign a check. If you look at the elec reports of the local machine candidates in Hoboken you’ll see a potpourri of out of town donors to local political campaigns. You may have been scratching your head before wondering why that was, well now you know. This could well end up being the beginning of a RICO case. If I am one of those donors I am nervous right now too.

Overall, 49% of voters say they at least somewhat approve of the President’s performance, RASMUSSEN will report later this morning.

This marks the first time his overall approval rating has ever fallen below 50% among Likely Voters nationwide. Fifty-one percent (51%) disapprove.

Eighty-three percent (83%) of Democrats continue to approve of the President’’s performance while 80% of Republicans disapprove. Among those not affiliated with either major party, 37% offer a positive assessment.

#37 No. They’re stupid. There’s no other explanation. Who would be dumb enough to take a bribe in New Jersey? The FBI has LOTS of smart young go-getters who would just LOVE to take these guys down and New Jersey is richly blessed with corruption. Always has been. Wow. A banquet of dirty pols to choose from. I wonder how many FBI agents are on the waiting list to be transferred to Jersey. You go, guys! Take ’em ALL down.

Don’t you love how mayors are addressed with ‘The Honerable’? If I met some guy on the street who insisted that I call him “the honerable Joe” or “the trustworthy Fred” I’d wouldn’t trust him with *anything*! :-)

The housing market in the Trenton area and across the nation has begun to recover from the most far-reaching crisis since the Great Depression, according to recent data.
…
“The tide is turning,”

Rather than the tide turning, it looks like we may simply be enjoying the relative calm of the eye of the storm. According to the Credit Suisse chart, we are now (this month) at the low point in mortgage resets. The subprime resets may begin to fade, but the Option-ARM crisis is still ahead.

46 Nom – I like to think of it as a very large selection of cooking wines. And the parking lot is a nightmare. The Gator family likes to frequent the Florham Park or Paramus (on Sundays only) TJs, for a much less stressful shopping experience.

And on visits to Nana and Pop Pop Gator, we like to frequent Wegmans and wish fervently that we will eventually have one closer to home.

“Mike said flatly that in his opinion the U.S. real-estate market was pumped up like an athlete on steroids,” says McDonald, a former Lehman vice president of distressed debt and convertible securities trading who says he was in the room that day.”

“This was not what Chief Executive Officer Richard S. Fuld Jr. wanted to hear. At the time, Lehman was still making a fortune by buying up mortgages, packaging them into collateralized debt obligations and selling them off. Yet Gelband was daring to broach an “unspoken question,” McDonald says: What if the property market crashes and we get stuck holding billions of dollars in securitizations we can’t sell?”

“Mike said flatly that in his opinion the U.S. real-estate market was pumped up like an athlete on st#roids,” says McDonald, a former Lehman vice president of distressed debt and convertible securities trading who says he was in the room that day.”

“This was not what Chief Executive Officer Richard S. Fuld Jr. wanted to hear. At the time, Lehman was still making a fortune by buying up mortgages, packaging them into collateralized debt obligations and selling them off. Yet Gelband was daring to broach an “unspoken question,” McDonald says: What if the property market crashes and we get stuck holding billions of dollars in securitizations we can’t sell?”

re #58 Elizabelth Warren she has no power. She is on a “Blue Ribbon” panel. Any political science professor in college will tell you if you wanted to delay or kill something down in Washington DC hand it over to a “Blue Ribbon Panel”.

WNBC-TV is reporting that South Jersey Democratic power broker George Norcross is “working behind the scenes” to get Jon Corzine to end his bid for re-election. Reporter Brian Thompson says that Norcross wants Corzine to be replaced on the November ballot by Newark Mayor Corey Booker or 6th District Congressman Frank Pallone.

Hey I have an actual real estate question. There is actually a CHASE REO in a neighborhood I like. Chase seems to have priced it pretty good considering house is in good shape. Have any of you ever dealt with Chase on an REO, if so what % off list can you expect? Also do they throw in Financing deals, I am already a chase customer.

No, I don’t think we do. Working at McDonalds is not a “career” (short of managing one), but rather a starter job, where one can attend college during evenings to obtain a real job that would support a family.

No, I don’t think we do. Working at Mc Donalds is not a “career” (short of managing one), but rather a starter job, where one can attend college during evenings to obtain a real job that would support a family.

No, I don’t think we do. Working at fast food places is not a “career” (short of managing one), but rather a starter job, where one can attend college during evenings to obtain a real job that would support a family.

And our dog did his Houdini thing again last night, first by ripping a piece of wood off the grate door that I put up to keep him from getting at the grate, then prying open the grate door.

It’s freakin’ astonishing how he does this. He is a 28 lb Boston Terrier, and he can get out of a crate made for much larger dogs. But he has been a Houdini Dog since puppyhood, so I will simply have to go nuclear on his furry ass and put a total plexiglass cover on the crate door so he can’t get at it. Knowing him, I expect to wake up some morning to find that the carriage bolts removed and the door hanging down in pieces.

@1 DL,
I think this falls in line with my forecast of the area lagging 6-12 months behind. There is 5 years worth of inventory in the Philly condo market and I’m seeing homes in the burbs w/ list dates well over 4 months. Price drops are inevitable in order to move these homes.

Wow, another Toricelli manuever? At least he has a compliant Supreme Court to rubber-stamp such a move.

We should be so lucky as to get Booker (who will get savaged in a statewide election, so no dice). Unfortunately for the Dems, the only other name with gravitas is Codey, and I doubt he wants the job. If this story gets any validation, it will weaken Corzine and the dems, just at a time when they are already getting hit with splatter from yesterday.

BTW, loved the photo op of Corzine announcing Doria’s resignation, with Anne Milgram standing behind him. I guess that is her contribution to the corruption-fighting effort.

re #81 – Cindy – Take a trip down to Washington DC if you are still off from teaching and be sure to visit Congress before they leave for the summer recess, to see for yourself how things actually work down there. They have already killed any banking reform down in DC, including the Consumer Protection Agency.

From Yesterday’s news.

According to the New York Times, on Jamie Dimon, the head of J P Morgan Chase, held a meeting of his board in the nation’s capital for the first time. White House chief of staff, Rahm Emanuel, attended.

WASHINGTON — Mr. Emanuel’s appearance would underscore the pull of Mr. Dimon, who amid the disgrace of his industry has emerged as President Obama’s favorite banker, and in turn, the envy of his Wall Street rivals. It also reflects a good return on what Mr. Dimon has labeled his company’s “seventh line of business” — government relations.

The business of better influencing Washington, begun in late 2007, was jump-started just as the financial crisis hit and the capital displaced New York as the nation’s money center. Then Mr. Obama’s election brought to power Chicago Democrats well-known to Mr. Dimon from his recent years running a bank there.

“It’s a very nice thing for the board to have happen,” said the chief of a major financial company. “But you’d have to have a lot of influence to pull it off.”

Nom 80 – Yes, replacing him is scummy, but there is a bipartisan history of doing things like this in our reputable, fair state. The R’s actually changed the gubernatorial primary date a few years back so they could run Bob Franks for Governor when Donny DiFrancesco dropped out of the race because they were so afraid of Bret Schundler running statewide. The primary electorate did not cooperate with the party’s plan though, and Schundler won the primary anyway. This is actually what prompted Stu to register as a Republican – he admired what Schundler did in JC and didn’t like that he was getting screwed by the party bosses.

I do think that this is Christie’s race to lose, regardless of who is on the ballot for the Dems. Just hope that the R’s don’t eat their own here. I have already read that NJ Right to Life will NOT endorse Christie because Guadagno is pro-choice. Christie needs all the hardliners to show up, or he is toast.

My favorite argogant chase story of the week was their is a rule that internal audit departments should have an external reveiw or a peer reveiw every five years. Chase tried to file for an exemption as they have no peers. The have so much better controls than everyone one else a peer review or big four review would serve no purpose.

My brother brought over a Scotty puppy last week for us to “try out.” Apparently it will keep the ferals away, if we train it for yard patrol. It’s already working, amazingly enough, but we’re not going to keep the puppy. Our prissy indoor cats are traumatized.

The dog got into some mud trenches yesterday after the rains, so today I put it in the tub before it goes home to my brother. Now, it’s still shaking an hour later. Maybe I used water that was too cold. I think I’ll turn the air off.

John 89 – They actually do audits at Chase? That place is a wreck. When my wallet was stolen a few years ago, they just handed over a 5k cash advance to a MAN carrying my DL and CC who did not produce a PIN for my account. Prior to this there was never a cash advance ever on the account.

I didn’t have anything in hardcopy with the account number on it (the card had just been replaced due to other questionable activity and I had not yet gone through a whole billing cycle). They wouldn’t give me my own account number to provide to the police to investigate the theft, and they wouldn’t give the info to the police either.

re: #94 – Cindy many of us here simply call it as we see it, I am not as much of a doomer as Clot but the fact that the banks are now basically holding their board meetings at the White House speaks volumes about our country. I am not an idealist since I have been down to DC and done some lobbying, I can tell you there is no such thing as “Change” down there.

A law can’t make a person worth more than their economic value to an employer.
Just imagine if the government started to establish minimum home prices.

What minimum wage laws tend to do is make it more difficult to hire the most marginal employees, typically youth labor. For these people, a chance to gain experience in the workforce is much more valuable (on a lifetime outlook) than the wage itself.

In NJ, the minimum wage is probably pretty irrelevant, because the prevailing wages for even the worst jobs are probably higher than the minimum wage. But in lower cost/lower wage parts of the country, a minimum wage like $10 would create some real problems.

When the minimum wage is kept relatively low vs prevailing wages (as is the case now), it’s relatively harmless, because it’s irrelevant, but politicians get to puff themselves up and pretend that it’s they, not economic forces, that drive up incomes.

When politicians actually try to create an uplift in incomes by boosting the minimum wage significantly, and to levels above market-determined wages, that’s when you start to see real distortions, and some winners, along with a lot of hidden losers.

88 NJGator: ”Christie needs all the hardliners to show up, or he is toast”

Not necessarily. This state is heavily democratic, but the moderate democratic base isn’t all that happy with Corzine. However, if this election becomes about “charging up the base” and “kowtowing to the hardliners”, then Corzine will win; the democratic base is simply much bigger.

Lonegan would have lost because he would have angered liberals and rallied the democratic base around Corzine, despite his unpopularity. While Christie may lose some hardliner support by not taking stronger conservative positions, that’s worth the risk (at least while he has a double digit lead).

Christie will win by being the “candidate whose name isn’t Jon Corzine”. He will win if heavily democratic urban voters stay home on election night.

via Consumerist is a Slate article on a Univ. Chi-town study of payday loans.
It turns out even if you spell if out as simply as you can; your $100 payday loan is %400 apr, you still only dissuade %10.
FTFA; But the borrowers who were given a chart explaining the three-month cost of carrying a payday loan were 10 percent less likely to take a loan during subsequent months.

There’s few if any politicians in the cess-pool that is the NJ Democratic party that would have a shot against Christie as the perception is they are all crooked. Christie didn’t have to go too far right in the primary so he can play it down the middle in the general election. Corzine is dogged by both the economy and the corruption.

Renting 100 – It will be interesting to see how it all plays out. You are correct about the moderate democratic base. I consider myself a part of it. While I don’t think I can pull the trigger for Christie, I would sooner stay home than vote for Corzine – which is essentially a vote for the GOP.

If the hardliners don’t come out for Christie because his LG is pro-choice, that would be cutting off their noses to spite their face. The LG will really have no impact on abortion policy in this state (and if Christie wins with a Democratic Legislature, he will have no impact either) – so why help elect Corzine who they disagree with 100% over a candidate they probably agree with 90%? The conservatives’s in this state have a long history of doing just that, which is the only reason that Corzine even has any chance at all.

Employer: Saint Joseph’s Prep School
Position:AP, AR, and every other Accoutiing postion during college
Location:Philadelphia, PA
Employer:Philidelphia Country Club
Position:Waiter
Location:Conshohocken, PA

Since the indictments of more than a dozen Jersey City officials and political figures came down yesterday, Jersey City has been rife with speculation about the identity of “JC Official 4” – a high ranking Jersey City elected official who turns up prominently in the federal complaint against Deputy Mayor Leona Beldini, city official Ed Cheatam and political consultant Jack Shaw.

The federal complaint mentions what appears to be the indicted officials acting as a middleman for “JC Official 4,” taking cash in exchange and structuring it to donate to his campaign fund in exchange for his help furthering cooperating witness Solomon Dwek’s real estate interests.

PolitickerNJ.com has confirmed that “JC Official 4” is Jersey City Mayor Jerramiah Healy, the Hudson County Democratic Chairman. A source close to the mayor admitted as much, but held that he had done nothing wrong.

“JC Official 4” is described in the complaint as “a high-ranking elected official in Jersey City, NJ… (who) was seeking reelection on or about May 12, 2009.”

That “JC Official 4” appeared to be Healy was first mentioned by the Jersey City Independent’s Jon Whiten yesterday, who noted that the complaint said that Beldini was treasurer for Jersey City 4’s reelection campaign. In this year’s election, Beldini was treasurer only for Mayor Healy’s campaign.

According to the complaint, “JC Official 4” first met with Dwek on March 13 of this year, along with the three defendants. The complaint does not quote him at that meeting, with only Shaw and Cheatem telling him that Dwek “the CW was ready to develop real estate with JC Official 4’s ‘help’ and ‘assistance,’ and JC Official 4 was further advised by the CW that ‘approvals are key.'”

After “JC Official 4” left the meeting, Shaw allegedly told Dwek to make the payments through him, after which Beldini assured him that she and “JC Official 4” would “help move” his real estate “approvals” along.

The money was paid to the “JC Official 4” campaign through $10,000 tickets to a fundraiser, according to the complaint. Beldini is quoted telling Dwek that “[w]hat we’re trying to do is put money into different funds so we can, when we need it, funnel it back into [JC Official 4’s election fund]. Which everybody does.”

According to the complaint, Shaw described “JC Official 4” as “very happy” with the contributions.

In a meeting with Beldini, Shaw and Cheatam at a Jersey City luncheonette on April 30, Dwek told her that he was applying for a zoning change and did not want it to go to the “bottom” of the pile.

“Beldini responded that she could say ‘one thing’ about JC Official 4–JC Official 4 ‘remembered’ JC Official 4’s “friends,” and JC Official 4’s word was ‘gold,'” according to the complaint.

The complaint says that Dwek agreed to make two more payments – one for $10,000 immediately after that day’s meeting, and another after the election.

“JC Official 4” later showed up to the meeting, where according to the complaint he was told by Cheatam Dwek wanted to be “on top” of the “pile,” and that he had given $10,000, planned to give $10,000 after that day’s meeting and again after the election.

“JC Official 4 responded, among other things, that hopefully “we” could work “together” and that this would be “mutually beneficial,” read the complaint.

After the meeting, outside of the luncheonette, Shaw allegedly told Dwek that everybody was “happy as hell” with the arrangement and accepted $10,000 in cash.

I just want to know if Cammarano can get extra points in his guidelines just for sheer stupidity. What lawyer takes an envelope full of cash from a man that is very publicly known to be in a boat load of legal trouble with the feds?

I was checking facebook last night, and I now regret getting cajoled into it as an ex-girlfriend from 30 years ago has asked me to friend her. I recall that I found her a bit strange, and the short relationship was memorable for its lack of memories.

I get the sneaking suspicion that her lack of meaningful employment will result in repeated requests for financial assistance.

In the other big case drawing attention and controversy, I had to extricate myself from a convo where a staffer in my office was railing about the Cambridge Police.

Here’s how we know there is no resolution: When I pointed out that the cop was also an instructor at the Police Academy on dealing with racial profiling issues, the staffer said “well, that shows he knows how to do it properly without getting caught.”

Nom 129 – Ignore, ignore, ignore! And especially ignore Facebook’s suggestions. They suggested I friend the guy who was probably the worst single date I had in my entire college life. He is friends with other friends of mine. His posts on their walls are just as boring as I remember him.

Weirdest recent friend request I got was from my HS Honors Geometry teacher. She seems to be friending her former students in her newly retired life.

The NBC News team of Brian Williams, Chuck Todd and Keith Olbermann were all enamored with President Barack Obama’s explanation that “it took us a couple of days” to express outrage over the AIG bonuses “because I like to know what I’m talking about before I speak.”

128.HEHEHE says:
July 24, 2009 at 12:15 pm
“What lawyer takes an envelope full of cash from a man that is very publicly known to be in a boat load of legal trouble with the feds?”

AND BRAGS ABOUT BEING AN ELECTION LAWYER WHILE DOING IT!!!

HEHEHE: He was in clear violation of election law in not reporting a fully list of campaign contributors…I thought it spoke volumes….if this does not end quickly and neatly, the Hoboken is screwed for a good amount of time. I assume that this slime is going to use leverage where ever he can to entract whatever he can….

Investigators say Cammarano, the youngest mayor in Hoboken’s history at 32-years-old, accepted a bribe from a dirty developer working undercover for the FBI. Outside of Hoboken’s City Hall on Friday morning, someone posted fliers of Cammarano with a “For Sale” sign asking for $10,000 underneath his picture. That’s the amount he’s alleged to have accepted last week, just three weeks into his job as mayor.

151
The air here has made me see stock prices have little to do with fundamentals it seems. I would have thought DOW 6000 is overpriced but the tape tells me I’m wrong. Me thinks there is a concerted effort to prop up stock prices by parties unknown to me. Sounds conspiratorial doesn’t it. I think dollar will be “massaged” down in spurts with plenty of opportunity to profit on way down.
btw: http://tinyurl.com/nwf8f8

163
Prop can mean not allowing anymore exaggerated downside. When we are comfortable with new baseline we all feel better and we can become consumers again. Time is a great elixir is getting us comfortable with a new norm. My organic produce induced brain makes me think Mr Market is letting us all get familiar with new valuations – which can be done if the downward slide is halted – that alone will be called “housing recovery.”

Misconduct
The receipt of retirement benefits is expressly con-
ditioned upon the rendering of honorable service by
a public officer or employee.Your benefits may be
reduced or forfeited if you are convicted of a crime
in any way related to your employment,or if you are
suspended or dismissed from your employment.
In accordance with N.J.S.A.43:1-3.1,the court may
order the forfeiture of all or part of the retirement
allowance in certain cases.
Also,in accordance with N.J.S.A.43:1-3,the Board
of Trustees is required to order the forfeiture of all
or part of the retirement allowance of a member for
misconduct during public service,which renders the
service,in whole or in part,dishonorable.The
Board evaluates the member’s disciplinary and/or
criminal charges using the following 11 factors to
determine whether the member’s public service is
considered honorable.
1.The employee’s length of service;
2.The basis for retirement,i.e.,age,service,
disability,etc.(includes the effective date of
retirement);
3.The extent to which the employee’s pension
has vested;
4.The duties of the particular employment;
5.The employee’s public employment and
service (includes the date of last pension
contribution);
6.The employee’s other public employment
and service;
7.The nature of the misconduct or crime,
including the gravity or substantiality of the
offense,whether it was a single or multiple
offense and whether it was continuing or
isolated;
8.The relationship between the misconduct
and the employee’s public duties;
9.The quality or moral turpitude or the degree
of guilt and culpability,including the employ-
ee’s motives and reasons,personal gain
and the like;
10.The availability and adequacy of other
penal sanctions;and
11.Other personal circumstances relating to
the employee bearing upon the justness of
the forfeiture.
The Division of Criminal Justice in the Department
of Law and Public Safety and the County and
Municipal Prosecutor’s Offices are required to
inform the Division of Pensions and Benefits when-
ever a public official or employee is prosecuted or
convicted.State and Local public employers are
also required to notify the Division of Pensions and
Benefits whenever a public employer takes formal
disciplinary action to remove a member from public
office or employment for cause on charges of mis-
conduct or delinquency.In these cases,the Board
of Trustees will consider all relevant documentation
to render a determination on any appropriate action.
The Board will suspend processing of a member’s
application for retirement pending the receipt of the
final disposition of charges against the member.All
claims for retirement,death benefits,or the return of
the member’s contributions cannot be processed
until the criminal or administrative matter has been
resolved to the satisfaction of the Board of Trustees.
The Division will postpone action on all claims
where there is pending litigation against the mem-
ber’s employment.In this case,the Division will hold
all applications or requests in abeyance until such
time as the matter is fully resolved.Once all the
required information is provided to the Division,the
Board of Trustees will consider each case on its
own merits.
New Jersey law stipulates that a retired member is
not eligible to collect retirement benefits if the
retiree is confined in a penal institution as a result of
a conviction of a crime involving moral turpitude.
The law provides that an eligible dependent may
continue to collect a retirement benefit if they can
prove to the satisfaction of the Board of Trustees
that they rely on the retiree’s benefits for their main-
tenance.
The member should contact the Division’s Board
and Trustee Administration Office,in writing,if any
of the conditions listed above should occur in order
to obtain more specific instruction on how to pro-
ceed.
For additional information,see Fact Sheet #76,
Honorable Service,which is available on the
Division of Pensions and Benefits Web site at:http://www.state.nj.us/treasury/pensions
May 2009 31
Public Employees ’Retirement System Handbook

Misconduct
The receipt of retirement benefits is expressly con-
ditioned upon the rendering of honorable service by
a public officer or employee.Your benefits may be
reduced or forfeited if you are convicted of a crime
in any way related to your employment,or if you are
suspended or dismissed from your employment.
In accordance with N.J.S.A.43:1-3.1,the court may
order the forfeiture of all or part of the retirement
allowance in certain cases.
Also,in accordance with N.J.S.A.43:1-3,the Board
of Trustees is required to order the forfeiture of all
or part of the retirement allowance of a member for
misconduct during public service,which renders the
service,in whole or in part,dishonorable.The
Board evaluates the member’s disciplinary and/or
criminal charges using the following 11 factors to
determine whether the member’s public service is
considered honorable.
1.The employee’s length of service;
2.The basis for retirement,i.e.,age,service,
disability,etc.(includes the effective date of
retirement);
3.The extent to which the employee’s pension
has vested;
4.The duties of the particular employment;
5.The employee’s public employment and
service (includes the date of last pension
contribution);
6.The employee’s other public employment
and service;
7.The nature of the misconduct or crime,
including the gravity or substantiality of the
offense,whether it was a single or multiple
offense and whether it was continuing or
isolated;
8.The relationship between the misconduct
and the employee’s public duties;
9.The quality or moral turpitude or the degree
of guilt and culpability,including the employ-
ee’s motives and reasons,personal gain
and the like;
10.The availability and adequacy of other
penal sanctions;and
11.Other personal circumstances relating to
the employee bearing upon the justness of
the forfeiture.

The Division of Criminal Justice in the Department
of Law and Public Safety and the County and
Municipal Prosecutor’s Offices are required to
inform the Division of Pensions and Benefits when-
ever a public official or employee is prosecuted or
convicted.State and Local public employers are
also required to notify the Division of Pensions and
Benefits whenever a public employer takes formal
disciplinary action to remove a member from public
office or employment for cause on charges of mis-
conduct or delinquency.In these cases,the Board
of Trustees will consider all relevant documentation
to render a determination on any appropriate action.
The Board will suspend processing of a member’s
application for retirement pending the receipt of the
final disposition of charges against the member.All
claims for retirement,death benefits,or the return of
the member’s contributions cannot be processed
until the criminal or administrative matter has been
resolved to the satisfaction of the Board of Trustees.
The Division will postpone action on all claims
where there is pending litigation against the mem-
ber’s employment.In this case,the Division will hold
all applications or requests in abeyance until such
time as the matter is fully resolved.Once all the
required information is provided to the Division,the
Board of Trustees will consider each case on its
own merits.
New Jersey law stipulates that a retired member is
not eligible to collect retirement benefits if the
retiree is confined in a penal institution as a result of
a conviction of a crime involving moral turpitude.
The law provides that an eligible dependent may
continue to collect a retirement benefit if they can
prove to the satisfaction of the Board of Trustees
that they rely on the retiree’s benefits for their main-
tenance.

I forgot about that. Priceless, especially since (and I discussed this yesterday) I saw this on CNN:

“Authorities have said they may release tapes of the officer calling in, in which Gates is heard in the background”

There may also be a record of a call made by Gates to Cambridge PD, demanding to speak to the chief.

If this “hard” evidence comes to light, it futher impeaches Gates, and makes the One look even more biased. I will take special delight in watching that human piece of phlegm Gibbs try to squirm out of that spot.

My fave is Rattlesnake Gutter Road in Leverett, MA (I think). Dark, windy, dirt road that cuts into a steep hillside. And we are bombing along it one night, with “Scumbag” Donovan at the wheel, slightly bombed, and his friend sees my discomfort and says “you don’t wanna see what is next to us”. Essentially a 200 foot drop the entire way. And Donovan starts joking about how he thinks the trees are gonna jump in the way of the car.

We all slept that night on wooden furniture. And the next morning, I woke up early and hid his ammo.

I forgot about that. Priceless, especially since (and I discussed this yesterday) I saw this on CNN:

“Authorities have said they may release tapes of the officer calling in, in which Gates is heard in the background”

There may also be a record of a call made by Gates to Cambridge PD, demanding to speak to the chief.

If this “hard” evidence comes to light, it futher impeaches Gates, and makes the One look even more biased. I will take special delight in watching that human piece of phlegm Gibbs try to squirm out of that spot.

Craziest drive I have ever been on was to Papakolea, the Green Sand Beach at the South Point of Hawaii’s Big Island. It’s very remote and you have to drive through a 4 wheel drive path that is so well worn, and steeply divoted that I thought we were going to flip and die many times over on the drive out there. Once you get there, you have to climb down a steep cliff to get to the beach. Still worth it. Once you get there, it is stunning. We have gone on two separate trips. There is no other beach like it.

Breaking news 2:54 PM
Obama speaks with Crowley
President Obama said today that he spoke with Cambridge police officer James Crowley, who had arrested Harvard professor Henry Louis Gates Jr. last week. Obama said he was left with the impression that Crowley was an outstanding police officer, but added that he believed both men probably overreacted in the situation.

Read it yesterday, and was noting that tapes may have existed, based on that report.

The Messiah is backpedaling furiously now, since he slammed a cop after admitting that he did not have all the facts, and now that there is more hard evidence corroborating the police report, and contradicting Gates’ story that he couldn’t have been shouting because of a medical condition.

President Obama this afternoon called the Cambridge police sergeant accused of racial profiling and expressed regret for his choice of words at a recent press conference, saying he inadvertently ratcheted up the media frenzy when he said police “acted stupidly” in the arrest of a Harvard scholar.

“I want to make clear that in my choice of words I unfortunately gave the impression that I was maligning the Cambridge Police Department and the work of Sergeant Crowley specifically. I could have calibrated those words differently,” Obama said in a surprise appearance at the White House briefing room. “I told this to Sergeant Crowley. I continue to believe that there was an overreaction in pulling professor Gates out of his home and to the station. I also continue to believe, based on what I’ve heard, that professor Gates overreacted as well.”

That is the closest you are gonna get to a mea culpa from this president. Look for Gibbs to tell his lackeys in the WHPC that there will be no further comment on this “settled” matter.

The stink from this one is gonna linger in some nostrils for some time though. Simmons and Patrick are gonna have to backpedal as well.

197 Chifi – I agree. Stu and I stayed in this place for a few days when we were on the Big Island for our honeymoon. It’s a very cool treehouse that was built by an urban planner from California that dropped out of society and lives in a shack next door, smokes weed and pumps gas while running this place. Very unique.

Nom 199 – Typical lawyer decision :) I did a little research online when looking for a link with pics. The road is now gated (you get a key if you leave a $25 deposit) and you can now hire folks to drive you there so you don’t have to violate your rental agreement. Only someone as crazy as Stu or Chifi would drive it. I’m glad Stu is that crazy though, because I never would have been able to make that hike in the heat.

Comrade (197)
While surfing channels the other day, I heard him say that African American women still get paid less than whites for the same job.

I gave him the benefit of doubt when he was elected because I was just tired of hating the president but I’m starting to see nothing but jive.
His comment that the economic recovery hinges on his health care package being passed was the final straw. What happened to his $700 billion economic package being the key to economic recovery?

Chifi 201 – Do you and Stu share the same brain. When we would stay on the Kohala coast, we would frequently make the drive up to Waimea for dinner. Stu always used to brag about driving the whole trip back completely in neutral.

“We stayed in Waimea where it was foggy and 65 degrees, then after breakfast we coasted down the hill to here….”

Gates: did you walk out on the lava? That was HEAT…. one of the coolest things I’ve ever seen was walking 2-3 miles on black dried lava (it is like someone dropped black glass everywhere…crunch, crunch)…then all of a sudden a road appears out of the ground. The two lane highway was about 1/4 mile long and with a yellow sign denoting 40mph curve ahead, then …poof…gone.

“The citizens of Hoboken need to get control of their city quickly or we are screwed.”

Homeboken
i hate to say it but these guys are what make hoboken what it is. They have an old school political machine system in place and to a large extent it works.
Any yuppy who moved to hoboken in the last fifteen years are considered tourists to those guys. Of course the yuppies will not be happy until they turn it into a teaneck, which they will eventually do one day.
So once you guys take control of that city back, i probably wont visit anymore. but taxes will probably go down a little.

Not just the most unpopular president/teleprompter in history at this point of presidency, but also the most partisan divide ever. So much for the past-racial, bipartisan harmony.

Anyway, I’m happy that the promised immediate relief from Stimulus was successful and we avoided that 8.5% unemployment. Thank god we have competent and sophisticated expert in charge. No need to feel shamed abroad anymore, like say idiot president handing out US-format DVDs or ipods to Queen of England and UK Prime Minister.

NJ has been saved too. Just some tax hikes, further regulation and extra government workers and things are perfect.

Barbara – we cashed in Continental miles to go free in first class. The flight, even non-stop is easy that way. It’s a cheaper first class ticket for mileage redemption than a ticket to Europe, for a much longer flight. One of the best values in FF miles IMHO.

But it is still worth the torture, even to do it in coach. I would leave the kids home though, if at all possible. We have not taken Lil Gator (last time we went was in 2006 when he was 1 1/2). We have spoken about doing it the next time we go, but it will definitely be a much more low key trip if we take him.

Chi 201 – Love that beach too. On our honeymoon, we stayed at the Hapuna Prince right next to the Mauna Kea resort for a few days. Got the room through Priceline. It was a fantastic deal.

Stu and I each booked half the hotels for our extended honeymoon trip. Captain Cheapo was frequently heard saying things like “What exactly does a $400/night hotel room have that a $100/night room does not?” or “I can be just as romantic in a cheap hotel room.”

For the record, on the Big Island, the answer to that question was Air Conditioning…and also a swimmable beach.

And in my defense, let the record state that we never paid $400/night cash out of pocket for any of the places we stayed. We cashed in hotel points, credit card points or scored the resorts at a discount through Priceline.

209 Veto- Exactly what about the political machine makes you enjoy Hoboken so much now? The politicians ability to collect kick-backs is what keeps the all the bars, resturants, deli’s and such in business? I just don’t understand why political reform would make the town less desirable to you.

For what it’s worth, I am 100% a tourist, I’ve been renting in Hoboken for 6 years. Quality commute, nice urban center. I am a tourist because I would never own in this town. The “old school” machine you seem to think has so much charm makes me want to puke. I would never be comfortable with thugs in suits controlling my property tax dollars and directing my kids schools. Once my first is born and ready for school, I am outta this town.

I owned for about 5 yrs there. $6500 property taxes on the first condo. $8200 on the second. Now I rent. The guy we sold the second place too said is taxes are over $10K and we sold the place to him in 2006. The machine is taking every new condo owner there and sucking onto their wallet like a monstrous leach.

TRENTON — Former Sen. Wayne Bryant, once a titan of New Jersey politics, was sentenced to four years in federal prison today for trading on his clout as budget chairman to obtain a pension-padding job. “I cannot express how deeply sorry I am for the scorn my actions have caused,” said Bryant, who choked up while apologizing for his crimes in Trenton today. Bryant will also pay $113,167 in restitution to UMDNJ. A jury convicted Bryant, a Democrat from Camden County, of 12 counts of pension fraud and bribery eight months ago, in a high profile trial the exposed a…

first class was the way to go. We did the same, and on the flight out from LA, John Riggins of the Redskins was next to us. Wife is an Eagles fan and I had to explain to her who Riggo was. Very nice guy, talked some football and Hawaii, a place he knows pretty well.

Did not ask him about getting bombed and falling asleep under the table next to Justice O’Connor at a Gridiron dinner. That would have been rude.

Nom 244 – Yes 100% pure. I believe we are currently drinking the Full City Roast. We’ll bring a sample for you to Brigadoon. I assume that you have your own bean grinder?

Captain Cheapo has done the math, and although the price per pound seems much higher than regular coffee, we use at least a full third less beans when we brew, so the smaller price differential
is definitely worth the increase in quality.

Yes, his eloquence is matched only by the scholarly brilliance he showed in his understanding of the law and consitutional issues presented in this matter.

Ack. I could have debated 0bama on this and beaten him like a rented mule. The reason he is getting in front of this now is because after the tapes are released (if the mayor lets them out), then Gates is in a bigger hole and 0bama is down there with him. So better to take ones losses now, do something conciliatory that isn’t an apology and “move along.”

Like I said, if this thing develops even more, expect Gibbs to deflect, saying the issue is old news and that the president has moved on.

“I just don’t understand why political reform would make the town less desirable to you.”

homeboken,
In order to reform the political foundation, you’re going to have to change all the residence. But you should ask yourself, if the town needs to change so badly, why did you move there in the first place? It certainly didnt go down hill in the last 6 years. its as thriving as ever.
The whole abbott charade is the perfect crime and could only be pulled off by the good ole boys machine. They know exactly what they are doing.
Dont get upset that its not a family friendly city, they dont want it to be. Its the youngest city in america with the most bars per sq ft and hot girls all over the place. they dont want you and your slobbering little baby in huge strollers all over the sidewalks to mess that up.
But the first thing the yuppies would do is ‘fix’ all the abbott school ‘problems’ so they can live there forever, but it would only cause millions in state education funding vanish immediately.
The next thing they would do is gentrify the hell out of the entire scene to look like willowbrook mall.
You are supposed to live in hudson county when you are young and want bars downstairs from your aptmnt, when honking horns outside dont bother you. When you grow up and have family, you are supposed to move to a quaint little suburb where the mayor doesnt double as a vote selling kidney thief. Its exactly how its supposed to be. So do your time, get it out of your system and move outwards. a little commute wont kill you. but dont try to change that town into something its not with your battle cry.
By the way, i consider myself a yuppy in this scenario and i lived there for 5 years before i got sick of all of it and moved out.

235 Veto
“But the first thing the yuppies would do is ‘fix’ all the abbott school ‘problems’ so they can live there forever, but it would only cause millions in state education funding vanish immediately.”

Veto – I see your point and I think you can figure out from my post that I have no intention of raising my kids in Hoboken. Here’s the rub though, the city of Hoboken absolutely MUST have a good number of wage earning yuppies to be what it is today.

The ideal mix is exactly what they have now. Just short of enough yuppies to elect one of their own and begin instituting change. Cammarano likely screwed the “old school” network very badly in that regard.

Remember Hoboken without the yuppies? Remember mid-80’s early 90’s Hoboken? The old school political regime stands to lose millions if that turn comes about. They could of have 4 more years of perfect balance, sucking the yuppies dry while still maintaing control. PC dropped the ball by screwing up the balance.

My comment on the One vs the cop – Prez should never get involved in local flaps. It is unbecoming of the office. I will start paying attention when the Messiah starts ignoring meaningless issues at local levels just because a black man could have possibly been wronged. Leave the race baiting to Sharpton. The POTUS should be more dignified than he has prove thus far.

HEHEHE,
Abbots districts are controled by the local officials when said local officals give out PILOTS to developers, thereby keeping the property tax revenues down to enable the schools to qualify for Abbot money. Its not direct control, its working the system. Its a racket.

Fearing economic collapse, many are salting away food — lots and lots of it..
Call them “suburban survivalists,” or call them, well, a little goofy. But they’re dead serious about being ready for a big crash”

Once, years ago (when I lived in Cambridge, what with all the racist cops;-)), my mom was going off on our single lifestyles and moaned “when am I gonna have grandchildren” and I replied “let me make some phone calls and see if you have any yet.”

I think it’s time to move to TEXAS .. Gov. Rick Perry, raising the specter of a showdown with the Obama administration, suggested Thursday that he would consider invoking states’ rights protections under the 10th Amendment to resist the president’s healthcare plan, which he said would be “disastrous” for Texas….http://www.star-telegram.com/804/story/1504240.html

yikes: Kauai is nice, but for some reason it just didn’t hit us the same way…and yes, I am a Starwood junkie….we’ve pissed through several hundred thousand starpoints over the years…..I think we are sitting on about 130,000. Before they revamped their internal systems, I used to know all the tricks to get stays credited. Ever since 2007, when they kicked out Heyer, they have been error free :(….I was platinum from 1999-2006.

Cindy 253 – We never snorkeled at Kapalua. We were lame and went to Molokini (along with everyone else). Some other amazing snorkeling was at City of Refuge on the Big Island – a giant Honu snuck up and scared the bejeezus out of me. And Hulapoe Bay on Lanai was nice – we saw crazy amounts of spinner dolphins there.

yikes: Kauai is nice, but for some reason it just didn’t hit us the same way…and yes, I am a Starwood junkie….we’ve pissed through several hundred thousand starpoints over the years…..I think we are sitting on about 130,000. Before they revamped their internal systems, I used to know all the tricks to get stays credited. Ever since 2007, when they kicked out Heyer, they have been error free :(….I was platinum from 1999-2006.

best to have a close relative working at starwood. the times square W has a suite that is $800 a night … you can get for $99. it’s rad.

chickens on kauai … hmmm … we took a horse and carriage ride (actually pretty cool) at this one restaurant (former plantation) … the guy talked about the chickens, but im drawing a blank. something to do with a barter system on the island dating back many years?

And how exactly are we supposed to continue consumerism??? To bad the US savings rate includes people paying off debt and defaulting. How do you save money when you owe on average 130% of your annual income?

While the proportion of consumers without jobs rose to 9.5 percent last month, household borrowing fell to 128 percent of the average family’s after-tax income in the first quarter from a record 133 percent in the same period a year earlier, according to data compiled by Bloomberg. The total debt of individuals, nonfinancial companies and federal, state and local governments grew at a 4.3 percent pace at the start of the year, down from a peak of 9.9 percent in the fourth quarter of 2005, Goldman Sachs Group Inc. estimated.

At the same time, rising unemployment helped lift the U.S. savings rate to 6.9 percent in May, the highest since December 1993.

Pubs closing at rate of 52 a week as hard-up drinkers shun their local

The rate of pub closures is accelerating, with 52 going out of business every week at a cost of 24,000 jobs over the past year, figures show. Almost 2,400 pubs and bars have vanished from villages and towns in the past 12 months, according to research for the British Beer & Pub Association (BBPA). Local pubs serving small communities have been the worst hit, the association said. The number of closures represents the steepest rate of decline since records began in 1990 and has risen by a third compared with the same period last year, when 36 pubs were closing every week.

Citi Trader, Who Made $100 Million Last Year, Insists on Keeping His Deal in Place

On the surface, the particulars of this case seem simple. A Citigroup commodities trader who says he has a contract that could yield him a $100 million payment this year is crossing swords with the new pay czar, Kenneth Feinberg.

Hall and his team get the upside (30%, more than a hedge fund success fee, more than even LTCM in its glory days, which got a 25% upside fee), but the taxpayer gets stuck with the losses. Hall and his bunch have the richest option deal going. Nor does it bother to point out that Hall would find it hard to get access to as much capital as Citi provides him on such rich terms from the outside. Citi not only provides him with more equity than he is likely to be able to raise (certainly for a 30% upside fee) and his cost of funding is sure to be considerably lower than if he were to operate on his own.

Citi is already too big to fail. The Phibro team is a stand-alone unit that takes a lot of risk that is not appropriate for a government-supported entity. The government safety net should extend only to crucial financial infrastructure. This is a great opportunity for Citi to shed a risky, non-core activity, which is exactly what it should be doing.

There are two bottoms we need to watch for, the first will be in volume, the next will be in price. During the last downturn, in real terms, these two bottoms were roughly 5 years apart.

Dear sellers, any questions? Oh, and sellers, before I leave to go to the beach today, I want to let you know that you lost another $3,000 this week because you received ridiculous, irrelevant advice from your loud, fat aunt.

“I too have been a close observer of the doings of the Bank of the United States. I have had men watching you for a long time, and am convinced that you have used the funds of the bank to speculate in the breadstuffs of the country. When you won, you divided the profits amongst you, and when you lost, you charged it to the Bank. You tell me that if I take the deposits from the Bank and annul its charter I shall ruin ten thousand families. That may be true, gentlemen, but that is your sin! Should I let you go on, you will ruin fifty thousand families, and that would be my sin! You are a den of vipers and thieves. I have determined to rout you out and, by the Eternal, (bringing his fist down on the table) I will rout you out.”

From the original minutes of the Philadelphia committee of citizens sent to meet with President Jackson, February 1834, according to Stan V. Henkels, Andrew Jackson and the Bank of the United States, 1928

foreclosures = savings. What kind of math is that by TPTB? I thought foreclosure = wealth destruction (family loses downpayment and any principal paid back plus blows up their credit report making borrowing more expensive, lender loses money to foreclosure costs.

But what do I know? I’m a simple house husband who spends most of his time cleaning, cooking,, and changing diapers.

It’s unbelievable these loans were ever used. How could a sophisticated investor or a banker actually believe zero down negative arms wouldn’t implode a few years later?

I could see a flipper or contractor using them to buy wrecks at a low price, renovate then sell for a profit, but why would a bank issue them to an investor for a cash flow negative property, or even to an owner occupier. Seems like a total lack of responsibility by lenders and the buyers of mbs.

I could see a flipper or contractor using them to buy wrecks at a low price, renovate then sell for a profit, but why would a bank issue them to an investor for a cash flow negative property, or even to an owner occupier. Seems like a total lack of responsibility by lenders and the buyers of mbs

I see the bank totally being irresponsible in this case.The buyer has a collateral,which is the house.The bank should have asked 20% of the value of collateral or more assets to cover the collateral in a down turn.In this case it is just proper the bank writes this off for making the wrong bet.

282 Kettle – “And how exactly are we supposed to continue consumerism?”

How do they expect people to spend money when they keep cutting back days and salaries? They are stealing money from the cities, counties and schools down my way to “balance” the budget. That equates to less people employed with less money to spend so even less tax revenue.

Have you ever thought about the loss of local businesses due to internet sales? I wonder what an impact that is having. A conversation at a party last night got me off on that tangent.

Friends says she went to a local Old Navy to get some things for the grandkids (no one in the store.) The stock was all picked over so she went home – on line and bought the sizes she needed. The loss of sales at the local brick/mortar just makes the situation worse so on and on the spiral goes. What a vicious cycle.

How much has internet buying impacted the commercial building/ CRE problem?
And won’t that only get worse? Opinions?

If they have a 500,000 house and put down $50m and paid $50m in interest, when the house gets taken from them, they are still “up” $400m even ignoring the future interest payments. Oh, happy days for them.

REVIEW & OUTLOOK
JULY 25, 2009, 6:35 A.M. ET.
Born to Take
What makes New Jersey politics so special?

Tony Soprano may be off HBO, but his imitators are apparently still alive and well and living in New Jersey. On Thursday, federal agents arrested 44 people, including at least 19 current or former New Jersey public officials, on corruption and money-laundering charges.

In most states, the arrests of more than a dozen government officials, including three prominent mayors, would elicit shock and even disbelief. In New Jersey, long-suffering residents have learned to expect the worst from their “public servants.” Still, even the most skeptical citizen might have hoped that former U.S. Attorney and current GOP gubernatorial candidate Chris Christie had drained the swamp when he prosecuted more than 130 Jersey politicos this decade. Turns out that the alleged rot runs even deeper in a state long synonymous with graft, as if anyone is really surprised.

Theories abound as to what makes New Jersey so special. The Wall Street Journal’s Law Blog asked two local college professors to explain the state’s long and undistinguished history of political corruption. Joseph Marbach, dean of the College of Arts and Sciences at Seton Hall, says that career politicians became established in Jersey earlier than in other places, and since the pay was modest, “a sense developed that a certain amount of graft was acceptable.”

Brigid Harrison, a professor of politics and law at Montclair State, says that old political machines have proven extremely durable, and that today the two big powers are the Democratic Party branches in Hudson County near New York and Camden County near Philadelphia. “It’s like the Mafia,” she told the Law Blog. “If you take out one family, the other family takes up more authority.” She’s predicting a power shift to Camden since members of the Hudson crew were pinched by the FBI.

We’d add that the opportunities for corruption multiply in proportion to the power and size of government. According to the Tax Foundation, New Jersey had the worst business tax climate among the 50 states in 2008 and 2009, the highest state and local tax burden in the country, and a top marginal income tax rate of nearly 11%. The state has 566 local government authorities with the power to impose a mind-numbing array of taxes, fees, regulations, edicts and ordinances.

Less power in the hands of government would mean fewer opportunities and fewer temptations for the pols to do business with Tony Soprano. If Mr. Christie really wants to change the state, as opposed to merely changing offices, his campaign theme is ready to order.

The glory days of New Jersey corruption, from a colonial cross-dresser to a filing cabinet stuffed with cash.

By BRAD PARKS

In a ritethat has become as familiar to them as Springsteen selling out the Meadowlands—but, alas, far more prevalent—New Jersey voters again had to endure a money-grubbing herd of their duly elected officials being led out of a courthouse in shame and handcuffs this week, having become the latest in a huge rogue’s gallery of state politicians to face corruption charges.

Watching it makes me think of an old African proverb—“a goat tied to a tree always eats from the same grass”—that speaks to the deep-rooted nature of corruption in New Jersey and to the voracious greed of those who engage in it. And while it’s doubtful the Swahili Bushman who coined the phrase had ever been to Hoboken—he couldn’t find parking—it’s hard not to think of it whenever we have another day like Thursday, when a group of Jane Councilwomen and Joe Assemblymen are made to walk before the cameras with their heads bowed and ushered into an old school bus, because it’s the only vehicle large enough to hold them all.

In a state that doesn’t have its own commercial television station—New York and Philadelphia dominate our airwaves—New Jersey elected officials have been thoughtful enough to provide us their own long-running sitcom. This latest episode featured 44 people, an unprecedented number even for New Jersey, being charged in an investigation into public corruption and international money laundering. The bust included five rabbis, three assemblymen and two mayors, prompting one late-night caller on the state’s talk radio station, New Jersey 101.5, to ask, “Where’s the partridge in the pear tree?”

Answer: The partridge is actually a cooperating witness, having turned state’s evidence to avoid prosecution.

The details are still a little sketchy—something about money-laundering rabbis and a black-market kidney?—but the pattern is familiar enough. The feds nabbed some smooth-talking alleged swindler, in this case a failed real-estate mogul named Solomon Dwek, who then curried favor with prosecutors by agreeing to wear a wire and fish around with cash-stuffed envelopes. Before long, he had hooked a whole school of greedy politicians, many of whom jumped in the boat before they even had a chance to swallow the bait, according to the criminal complaints against them.

In doing so, Mr. Dwek joined the likes of Robert “Duke” Steffer, the “demolition contractor” who snared the famed Monmouth 11 a few years back; or the illustrious Jerry Free, a cement salesman who lured in a Paterson mayor and an Essex County executive, among others, with cash, trips and Brazilian hookers—prompting the explanation from the Paterson mayor that he accepted hundreds of thousands of dollars in kickbacks and illegal gifts because he had gotten “bogged down” in the hard work of governance.

And, yes, we laugh about it, in the same way we laugh about our landfills, our pollution and the New Jersey Nets. But it’s only funny until you realize that, as a taxpayer, you’re the rube footing the bill. So we smack our foreheads, slap down our morning papers and wonder how we once again have become a national punch line. (I say “we” because, even though I recently moved to Virginia, my heart remains in New Jersey, where I lived for 10 years.)

Because, like the goat, we in New Jersey keep having to swallow the same pulpy stuff. Long before we had the nation’s first gay-American governor—James E. McGreevey resigned after giving his boyfriend a high-level state job—we had Lord Cornbury. New Jersey’s first colonial governor wasn’t only a cross-dresser, he was also known for taking bribes and appointing relatives to important positions.

So it began and, in many ways, has continued unabated throughout our history. We have had Frank “I am the law” Hague, who never made more than $9,000 a year as mayor of Jersey City, and never held another job during his 30 years in office, yet died in 1956 with an estate estimated at $5 million. Or there was the 1980s’ Abscam—an oh-so-clever contraction of “Abdul” and “scam”—in which FBI informants posing as Middle Eastern businessmen doled out bribes netting themselves 31 public officials, including a U.S. senator from New Jersey. Or there was Hudson County executive Robert Janiszewski, who got caught taking a $5,000 bribe a few years back and became a cooperating witness, whereupon he led investigators to the filing cabinet he had stuffed with cash-filled envelopes, because he had so many he didn’t know what to do with them.

Lately, our jails feel like they have a revolving door just for state senators: A month after former State Sen. John Lynch got out of jail for taking kickbacks, former State Sen. Wayne Bryant was yesterday sentenced to four years in prison for taking a no-show job.

Then there’s Newark, which deserves its own chapter in corruption ignominy. You have to go back to 1962 in New Jersey’s largest city to find a mayor who completed his time in office and wasn’t later indicted for it. The current mayor, the ever-trendy Cory Booker, has positioned himself as a real reformer. Yet so had the former mayor, Sharpe James, when he came into office in 1986. After 20 years during which he and some of his handlers grew increasingly crooked —his chief of staff, who was found with bricks of cash hidden in his floorboards, went to jail on corruption charges in the 1990s—Mr. James is now serving time for steering cheap city land to his mistress. But that still pales in comparison to Hugh Addonizio, who left the U.S. House of Representatives to reign over Newark City Hall from 1962-1970, in part because, as he was quoted as saying, “You can’t make much money as a Congressman, but as mayor you can make a million bucks.”

There have been reform efforts, sure. But there have also been elections like the one in Hudson County in 1889, where voters—many of whom, it turned out, were not quite breathing on Election Day—were thoughtful enough to cast their ballots in perfect alphabetical order. Even our golden-domed statehouse in Trenton is a monument to graft: Originally estimated to cost $19,000 in 1881, it was completed six years late and cost nearly four times as much—including a $1,350 flagpole.

It’s true that New Jersey is by no means unique in having officials who misuse the public till. But it is generally accepted that, among the 50 U.S. states, only Louisiana compares with New Jersey in the pervasiveness of its corruption—the difference being in Louisiana, they actually know what they’re doing is wrong. In New Jersey, cash for influence has become so commonplace a lot of politicians don’t even understand it’s illegal. And so we get the spectacle of Hoboken mayor Peter Cammarano on Thursday, standing silently as his lawyer promised to fight these unfair and untrue charges—this from a guy who had been mayor all of 23 days, yet, according to authorities, he had already been caught on a federal wire tap telling a cooperating witness, who was about to hand him $5,000 in cash, he would be “treated like a friend” when his projects came up for approval.

We have our excuses, both historical and contemporary, as to how we’ve become such a locus for official malfeasance: The state has long been an entry point for immigrants, who have tended to be easy to snooker. It is the most densely populated state with the least amount of available land, so developers and industrialists are always looking for an edge. And we are noted for having our share of, ahem, organized crime.

But the main problem—and this is the “tree” part of the goat-tied-to-tree proverb—is that the state is enormously over-governed. In most states, the local unit of government is the county; in others, it’s the municipality. In Jersey, we have both, and lots of them. There are 566 municipalities—California, with four times the population, has only 480—and each has a mayor and/or councils. The 21 counties have their various freeholder boards and utility commissions and there are also 120 state legislators. When that many people have their hands in the cookie jar —and there are that many cookie jars—is it any wonder that you get people selling Oreos out of their trunk in the parking lot to make a little extra cash on the side?

What’s more, much like the nation’s congressional districts, the vast majority of New Jersey’s 21 counties are either heavily Republican or heavily Democratic, with voter registrations tilted to one side by a margin of 10% or more. The result is entrenched political machinery and the kind of hubris that we heard from Mr. Cammarano, who was caught bragging, “I could be, uh, indicted, and I’m still gonna win 85 to 95%” of certain key voting blocs, according to authorities. A Hudson County freeholder was re-elected while under indictment a few years back.

This has been a kind of golden era for corruption cases in New Jersey, where a few years back a fundraiser for George W. Bush, heretofore unproven as a prosecutor, was named U.S. Attorney for New Jersey. Chris Christie ended up making enough of a name for himself—he left office with a perfect 130-0 record in corruption cases last year—he now has a commanding lead to unseat Gov. Jon Corzine come November in a state starved for someone to clean up its mess. And while critics said he was merely collecting trophies to place on his political mantel, Mr. Christie counters it actually wasn’t that hard to catch dirty politicians in the state. It would only get complicated because the perpetrators were so gluttonous—and so dumb—that as soon as word got out a contractor was throwing around money, they started tripping over themselves to cut their buddies in on the action.

The dollar amounts are inevitably small, relative to what’s being sold, which is only one of many sad aspects of these cases. Like most morally flexible Americans, I have a price at which I would gladly sell out my most cherished ideals—mine is $10 million, in case anyone is buying, and I figure it would be enough to set me up on a tropical island where no one would have heard of my shame. But most of these Tony Soprano-wannabes sell out for $5,000 or less, which is perplexing when you consider state assembly members are making $49,000 a year for part-time work. They’re risking their reputations, political careers and freedom for a little more than a month’s pay.

The only possible explanation is that the graft is so widespread, they figure they’ll never get caught. I once had a long, off-the-record conversation with a disgraced former public official who simply started unloading all the things he had witnessed—and been a party to—during his time in office. It was the usual bid-rigging, influence-pedaling and other tomfoolery that has become the norm, and there was so much of it my notebook was practically throbbing by the time we were done. Most of it was a few years old, so I never got around to verifying it. Yet it left me with the distinct impression that, much like Turnpike speeders, the number of people who get caught is really quite small compared with the number of people doing it. George Sternlieb, a longtime head of local government studies at Rutgers, the state university, was once asked what percentage of municipal governments in New Jersey were corrupt. His answer: “About half.”

So the crooks are everywhere. Yes, they have tended to be more urban than rural and more Democratic than Republican. But taken as a whole, they cut across demographic, racial, ethnic and political lines and suggest that there is something universal about corruption in the state. And we sometimes revel in it: We actually discuss what people wear to their perp walks like its our own Oscars red carpet. When Tamika Riley, the mistress of former Newark mayor Sharpe James, was arrested in a daring blouse that divulged about six inches of cleavage, it was buzzed about for months. She was later convicted.

But mostly we revile it. And we are revolted by it. And we are resigned to it. New Jersey corruption cases are a bit like eclipses—lunar, not solar—in that they happen with predictable-enough frequency to be mentionable but not all that remarkable. And if you happen to miss one, fear not, there will always be another one soon. The goat is always hungry.

—Brad Parks is a former reporter with The (Newark, N.J.) Star-Ledger. His debut novel, “Faces of the Gone,” is due out from St. Martin’s Press in December.

If i was an investor and bought a house in 2005 to flip.My mortgage is $3000.00 a month at 6% with no money down.If my total carry cost is $5,0000 a month with property tax and utilities.Will it not make sense for me to walk away in 2006 knowing prices will come down and save the $5,0000/month for 5 years and pay cash for the same house.
Who cares about my credit report,it will be fixed in seven years.

322 resident-social$st in charge Shore:
“Another example of how the Bush Administration was a bigger threat to liberty than al Qaeda:”

Uh. So Bush considered (and rejected) sending military to capture the enemy combatants (terrorists) is the biggest threat? FDR captured 8 German agents in NY and they were executed by military court, but hey, FDR was liberal so it was perfectly ok.

Your idol Teleprompter has in 6 months damaged this country more than Soviet Union. Trillions have been wasted and he is intent on destroying the economy for good, making it government-run (things worked out so well in CA and NJ so let’s make it national). Even Sweden and France are leaning away from this lunacy and going towards free-market economy.

Margaret Thatcher said it well. Soc$alism always ends up the same way. Eventually, you run out other people’s money. See NJ, CA.

Only positive thing with Teleprompter is that he is so dumb and arrogant that he is discrediting liberalism and social$sm for the next 50 years (and taking down State Media and Democratic Party with him).

i guess every RE gurus on this board are at beach right now. I haven’t heard any serious take on SRS since Friday afternoon.

a few months ago, a resident RE guru claimed it was a lift-time opportunity when it was at $130. now I would offer a fool’s take thinking it is an opportunity in multi-generations since it was at 16.5 as Friday’s close. but no one here is interested in it any more?

seriously, it may be hard for srs to go back to 20’s. but it may be a short-term summer opportunity due to recent rally in the stock market.

Group? As in a band… – Yes – My life-long hobby – A very ooollllddd group. Strictly cover stuff from way back when. We literally play in a garage (up in the foothills on 20 acres) and have been together since college. That’s 40 years. We actually perform maybe twice a year so our GTGs are really just an excuse to party.

I just finished listening to Cream – Crossroads ….no, we won’t go nearly so fast…but it was a special request for a gig in August. I needed a refresher…1 2 3 solo solo repeat 3 solo solo then 4. Got it.

Have a great day all…

Oh Chicago #325 – I was counting the pizza joints and sushi bars as “restaurants.” Not so many dry cleaners but lots of nail spas. We are wearing cotton shorts and baring our toes in 100 degree weather.

Yes, Chinese and Thai food, lots of Thai here in the valley. That’s about it for the strip malls…oh, and an insurance office here and there.

July 24 (Bloomberg) — The country’s biggest banks are doubling down on a bet that the economy will improve in the latter half of the year. If they’re wrong, and borrowers don’t pull out of a tailspin, bankers and their investors will take a beating.

That’s because banks will have to rebuild diminishing reserves that they set aside for soured loans, which results in charges that lower profit.

Signs that big banks are hoping to draw the equivalent of an inside straight on an economic rebound emerged in second- quarter results. Figures from the country’s seven largest commercial banks by assets, including banks like Wells Fargo & Co. and Bank of America Corp., show they went easy on increasing loan-loss reserves in the quarter.

That followed a similarly light buildup in the first quarter. Such moves help bolster bank profits.

If loan losses slow during the next six months because, say unemployment levels off and housing stabilizes, banks will win big with this bet. They will have pumped up profit today while allocating sufficient reserves for the rest of the year.

At some point in every economic cycle, wagers like these pay off for banks as loan losses peak and provision charges ebb. Timing is everything, though, and there are reasons to worry banks are making their recovery play too early.

Economists forecast unemployment to rise higher than 10 percent. While there are growing signs housing may be near a bottom — yesterday’s announcement of June existing home sales beat expectations — it is doubtful prices will rebound soon. This means foreclosures will persist.

Bernanke’s Warning

Plus, commercial real estate loans are a growing threat. U.S. commercial property prices have declined 35 percent since their peak, Moody’s Investors Service said in a recent report, while Federal Reserve Chairman Ben Bernanke warned Congress this week that defaults in this sector may pose a “difficult” challenge for the economy.

Meanwhile, banks’ credit losses aren’t showing signs of slowing. At J.P. Morgan Chase & Co., these charge-offs increased to $6 billion in the second quarter from $4.4 billion in the first three months of this year.

Wells Fargo saw charge-offs rise to $4.4 billion from $3.3 billion in the first quarter. Yet as those losses rose, Wells increased its reserve by only $700 million compared with a $1.2 billion buildup in the first quarter.

Unless loan losses soon slow, Wells “will have to start materially increasing its provision expense, which will put pressure on earnings and valuations,” Paul Miller, a bank analyst at FBR Capital Markets, wrote in a report this week.

Sour Loans

Wells isn’t alone in dragging its feet on bulking up reserves. Of the seven biggest banks by total assets, all but Citigroup Inc. saw the growth of nonperforming assets — mostly loans likely to result in a loss — grow at a quicker pace than the increase in the bank’s loan-loss reserve, according to my calculations.

Additionally, all the banks except Citigroup saw reserves as a percentage of assets fall in the second quarter. Citigroup’s reserves increased to 128 percent of nonperforming assets compared with 119 percent in the first quarter.

Of the other banks, JPMorgan has the highest reserves ratio at 170 percent and SunTrust Banks Inc. had the lowest at 47 percent. Bank of America’s ratio fell to 116 percent from 122 percent, while US Bancorp’s declined to 114 percent. Wells saw its reserve ratio fall the hardest, dropping to 128 percent from 181 percent.

Nervous Shareholders

While banks don’t have to keep reserves as a percentage of potentially dud loans at a specific level, investors are likely to get antsy if this nears a one-to-one ratio at bigger banks.

That makes it more likely the banks will have to add more money to their reserves if the economy doesn’t rebound as planned.

Investors tolerate ratios below 100 percent at smaller banks because they tend to have less debt tied to credit cards and automobile loans that can result in higher losses.

That said, SunTrust’s ratio is looking uncomfortably low. And PNC Financial Services Group Inc.’s results released yesterday showed its ratio of reserves fell to 101 percent of nonperforming assets.

The dilemma for banks is that keeping reserves at a higher level can wipe out profit. If PNC, for example, had wanted to maintain its reserve at the first-quarter level of 124 percent, it would have had to add about $1 billion to its reserves. Doing so would have wiped out the $207 million net profit it reported in the second quarter.

SunTrust’s Loss

A move to keep the reserve at an equivalent first-quarter level at SunTrust would have likely doubled what was already a $183 million net loss for the second quarter.

For the moment, markets are tolerating the slower reserve buildups, trusting along with banks that an recovery is at hand. After all, lower charge-offs help buoy profits and that lifts share prices.

If the economy deals the wrong set of cards in the second half, though, optimistic bankers may find themselves out of jobs while investors face a new round of losses.

Mortgage on a $100,000 home is $600.00 property tax back then are about $300.00.
$900.00 a month compare to $12000 a month on rent is an equity of $300.00/ month you don’t have to pay on rent plus tax deductions and decrease in balance owed.so yes,even if you sold the house at the same price bought,you are ahead.

If you have the same property now,wich i have.Either the mortgage is still $600.00/month or its paid off wich i have.property tax is $460.00/month.
when rent is $1600/month,I am proud to announce i am ahead.

Got a beemer in the driveway from that diference in rent.I can get $300,000 for this piece of crap all mine tax free plus all the savings.But hey where will i go if i sell.

State Assemblyman Daniel Van Pelt, R-Ocean, as of Friday had not yet told colleagues whether he will resign his legislative seat or his position as Lumberton’s township administrator.
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That latter decision may be made for him, however, as the Lumberton Township Committee is set to meet at 2 p.m. Saturday to discuss Van Pelt’s situation and possibly take action.
Van Pelt was arrested Thursday along with 43 other politicians and religious leaders from Monmouth, Ocean and Hudson counties and New York in the latest incarnation of the FBI’s Operation Bid Rig.

He was charged with accepting a $10,000 bribe in connection with a land development deal.

“I did ask for his resignation,” Mansdoerfer said. “I thought that would be the best thing for Lumberton. He said he was going to sleep on it and he would get back to us today. I have not heard back from him.”

“We’ll take official action (Saturday) if we don’t hear from him by then,” Mansdoerfer said. “The ball is in his court.”

Van Pelt earns $96,000 as Lumberton’s administrator.

State Assemblyman Brian E. Rumpf, R-Ocean, Van Pelt’s running mate, said Friday that he had not heard from Van Pelt.

“I have not spoken to him today,” Rumpf said. “I don’t know his plans.”

Rumpf and state Sen. Chris Connors, R-Ocean, have called for Van Pelt to resign from his office and drop out of the reelection campaign.

ZURICH (Reuters) – Switzerland wants to join the European Union Emissions Trading Scheme and hopes to start formal talks to that end after a climate change meeting in Copenhagen in December, the government said on Friday.
Moritz Leuenberger, Swiss transport and energy minister, told EU Environment Commissioner Stavros Dimas at a meeting in Sweden the Swiss government wanted to bind the country’s own emissions trading system with that of the EU.

“The advantage of that is that it would significantly expand the emissions trading market for Switzerland and expand the flexibility of Swiss firms to buy and sell emissions certificates,” his ministry said in a statement.

The EU’s Emissions Trading Scheme puts a price on carbon dioxide and forces companies to pay for permits for each metric ton of CO2 they emit into the atmosphere.

Leuenberger agreed to pursue technical talks between EU and Swiss experts initiated in 2005 and said formal negotiations to agree a deal could be started after the Copenhagen conference.

The Kyoto Protocol, a treaty limiting greenhouse gases is due to be renewed in global talks culminating at the Copenhagen conference

NEW YORK (Reuters) – Bankers and traders, no matter where they work, might have Goldman Sachs Group Inc to thank for heftier bonuses this year.

As Goldman Sachs rakes in record earnings, it continues to give employees $1 for every $2 it takes in. So far this year, Goldman has set aside $11.3 billion for compensation, or 49 percent of its net revenues.

By maintaining that ratio, Goldman is forcing the hand of some competitors, compelling them to set aside more for payouts, even as they report narrow profits or losses.

“What they are doing is they are raising the bar and putting pressure on all of their competitors,” said Brad Hintz, an analyst with Sanford C. Bernstein. “The competitors are facing a challenge.”

Morgan Stanley Chief Financial Officer Colm Kelleher said during Wednesday’s earnings conference call that “competitive pressures” are affecting the bank’s pay levels. Morgan Stanley boosted its compensation pool even as it posted a wider-than-expected $1.26 billion loss during the second quarter.

“Obviously, everyone would like to have far more revenues to make the compensation issue easy,” Kelleher said.

So far this year, Morgan Stanley has set aside $5.9 billion, or 71 percent of its net revenue, for compensation. The tab was driven up in part by expenses related to the completion of the Morgan Stanley Smith Barney joint venture and it is not adjusted for improvements in debt valuation.

During the first half of 2008, as Morgan Stanley reported profits, it set aside $6.9 billion, about 50 percent of net revenue, for compensation.

“It is always difficult when you are a little bit of the laggard,” said Alan Johnson, a compensation consultant with Johnson Associates in New York City. “When things are getting better you get squeezed. You don’t have as much revenue to afford compensation, but your competitors are doing better.”

A star trader and his team have threatened to quit the financial giant’s Phibro LLC energy-trading unit if their 2009 contracts, which could earn them as much as $100 million, are not met, The Wall Street Journal reported in its online edition.

But Citigroup /quotes/comstock/13*!c/quotes/nls/c (C 2.73, -0.04, -1.44%) , which has received some $45 billion in bailout money from the U.S. government, could put itself in the center of a controversy if it honors the contract, much like American International Group Inc. /quotes/comstock/13*!aig/quotes/nls/aig (AIG 12.46, -0.20, -1.58%) did earlier this year when it paid out $165 million in bonuses.

Andrew Hall heads up a small group of traders that has made hundreds of millions of dollars in profit to Citigroup for many years, the Journal reported. This year’s and future profits are key to Citigroup’s recovery.

If the company refuses to pay Hall and the others, that could prompt the group to leave en masse and sue Citigroup.

However, if Citigroup hands out such handsome profits, it could be in trouble with Kenneth Feinberg, the Treasury Department czar whose job it is to set pay for top executives and highly paid employees at the seven firms that have received big bailouts.

“Companies will need to convince Mr. Feinberg that they have struck the right balance to discourage excessive risk-taking and reward performance for their top executives,” a spokesman told the Journal.

For its part, Citigroup said in a statement that “Retaining and attracting the best talent is very important to the success of Citi and all its stakeholders. Citi continues to examine ways to ensure its employee-compensation practices are competitive in this very challenging market environment.”

Among the options Citigroup is considering in this case is a spinoff of Phibro, which would enable Citi to continue to siphon off some of the unit’s profits without having the responsibility of the pay packages, the Journal said

Though stock market prices are valued fairly now, Shiller said, equities remain a “risky” investment because the United States has not turned the corner on its fiscal crisis. He warned that stock prices “could fall dramatically.”

Shiller is the co-creator of the closely watched S&P/Case-Shiller Home Price Indices. His books include “The Subprime Solution: How Today’s Global Financial Crisis Happened, and What to Do About It.”

During an interview in 2006 with Newsmax’s Financial Intelligence Report, Shiller accurately warned of a looming price bust in housing. During a recent interview, Newsmax.TV’s Dan Mangru asked Shiller where he sees the housing market going from here.

“In the United States, home prices have been dropping at a rapid clip,” Shiller responded.

“However, in the latest S&P/Case-Shiller data, the rate of decline seems to be reduced, and in fact, in seven of our 20 cities, home prices were rising in April. So it does seem to me that we are getting closer to a bottom at the very least.”

Last week, demand for home-purchase loans decreased and the unemployment rate now stands at 9.5 percent, Mangru pointed out, and asked: Are home buyers just scared?

“And we don’t know that it’s over yet. We had a really bad unemployment report, and unemployment could easily exceed 10 percent. People know that. That’s one reason the personal savings rate has risen to 6.9 percent, levels we haven’t seen in decades.

“Even though the confidence surveys seem to be relatively upbeat, I don’t know if it really translates into willingness to purchase yet.”

Unlike other analysts, Shiller doesn’t believe the key to a U.S. economic recovery lies in the housing sector. He argues that the United States should first get its credit markets in order and get banks lending money again.

He told Newsmax.TV he doesn’t think some proposals calling for increased tax credits for all home buyers is a good idea.

He sees the $8,000 tax credit for new home buyers as stimulative because it forces new home buyers into the market rather than existing homeowners who would put their existing properties up for sale.

In discussing the overall economy, Shiller said the United States had avoided an economic “catastrophe” because of intervention by the Federal Reserve and Treasury, but the nation remains in a “bad recession.”

Instead, Shiller foresees a “risk of a weak economy for years to come.”

He advises conservative investors, especially those who are retired and on fixed incomes, to be wary of stocks.

Shiller compared the country’s economic crisis to the same “liquidity trap” the United States faced in the Great Depression. The federal government needs to pump more economic stimulus, via increased spending or tax cuts, into the economy, he said.

He thinks the first stimulus wasn’t enough and has unwound too slowly.

Asked whether he sees the Fed’s increase of the nation’s monetary base as inflationary, Shiller said no, at least for the near future.

However, he suggested that the economy could face “the possibility of substantial inflation” a “few years down the road.”

He believes that investing in commodities is a “smart thing to do,” regardless of whether inflation hits.

NEW YORK — For the past six months or so, Wall Street has been bracing for what many fear may be the next shoe to drop on the already battered U.S. economy: a U.S. commercial real estate bust that could rival the housing market collapse.

The U.S. commercial real estate sector has been grappling with a credit crisis that has dried up some of its most important sources of lending. That has left many borrowers unable to refinance maturing mortgages. Even when they can obtain financing, borrowers are often obtaining much less than they need.

Lending is based on a percentage of a property’s value and prices are off 34.8 percent from their peak in October 2007. Many see the decline reaching 45 percent.

But banks have been loathe to foreclose on the mortgages and are extending them.

“They’re taking loans that don’t have a cash-flow problem, but definitely have a valuation problem, and they’re pushing those out to the future,” Anderson said.

About 4.5 percent of bank commercial real estate loans were 30 or more days delinquent in the second quarter, up from 3.6 percent in the first quarter, according to Foresight Analytics. Nonaccrual — or the percentage of the loan balances that banks believe borrowers will fail to repay — rose to 2.6 percent in the second quarter from 2 percent the prior quarter.

Banks account for about $1.7 trillion, or half, of U.S. commercial mortgages outstanding. The delinquency rates have been increasing since the second quarter 2007, when they were 1.2 percent, according to Foresight.

Yet foreclosed loans as a percentage of nonaccruals has been declining, down to 19.7 percent in the first quarter from over 30 percent three years ago, according to the most recent statistics from Foresight.

The practice of extending loans has become so prevalent, it has earned its own catch phrases — “push-outs,” “kicking the can down the road” and “a rolling loan gathers no loss.”

THE PERVERSE LESSON

Banks have many reasons not to foreclose.

First, it’s an expensive processes. Secondly, banks are not in the business of owning real estate. When they sell a property, they face the same distressed market their borrowers would face, leaving them saddled with more losses.

They also have learned a “perverse lesson” from past commercial real estate downturns, Anderson said. After they dumped bad loans in the early 1990s, banks watched as buyers of the distressed loans, such as Goldman Sachs Group Inc’s Whitehall Funds, made a fortune when the market rebounded.

Banks already are dealing with losses from other sectors, such as home mortgages and credit cards delinquencies. Pushing the commercial real estate problem further into the future may allow banks to be in a stronger position when they finally face the issue.

“Rolling it over does not solve the issue,” Daniel Penrod, senior industry analyst for the California Credit Union League said. “But at this point, adding another negative to the current economy could be disastrous. If this were the only factor in the economy that was struggling, we could let it play out with all the other factors. Allowing it to catch its breath for six or 12 months may help shorten the current recession.”

Property values could fall should loan extensions not be long enough to give borrowers confidence that they will retain the properties. A three to nine-month extension could discourage a borrower from paying for needed maintenance and improvements.

But the lending market for loans under $35 million has thawed since the start of the year, said Deutsche Bank research analyst Richard Parkus.

“They should not be out there extending loans because there’s a financing market,” he said. “If there’s a loan that doesn’t qualify, it shouldn’t be extended unless it could be reasonably assumed to qualify in two to three years, given an extension.”

A new mortgage might not cover the full payment due at maturity. But that shouldn’t relieve a borrower from kicking in more equity or obtaining a mezzanine loan to fill the gap.

“If a borrower can’t get additional financing, it should be foreclosed and liquidated,” Parkus said.

Postponing foreclosures may compound a bigger problem of loan maturities ahead. Some $270 billion to $275 billion of loans are set to mature next year. Ultimately, the refinancing of the rolled over loans may soak up the available capital at the expense of new loans.

“If it continues, essentially for most of the next decade, we’re really just going to be dealing with today’s and yesterday’s debt,” Anderson said

This should get very interesting, FDIC had $13.0 billion, 0.27% of insured deposits at the end of 2Q09 (second quarter).

This bank alone could blow out the FDIC insurance fund this weekend of early next week. at that point the FDIC would have to tap its 500 billion line of credit with the treasury.

We have seen about 125 banks go down since 2007. anyone think that the 500 billion line of credit will be enough???

Guaranty Financial, No.2 Texas bank, says may fail

Guaranty Financial Group Inc, the second-largest publicly traded bank in Texas, said it will probably fail after loan losses and writedowns left it “critically” short of capital. The bank, whose investors include Carl Icahn and Robert Rowling, is in talks with at least one investor group for a possible recapitalization, said a source familiar with the situation. The source requested anonymity because the talks are not public.

“The company believes that it is probable that it will not be able to continue as a going concern,” Guaranty said in a regulatory filing. The Austin-based lender has about $16 billion of assets and more than 150 branches in Texas and California, according to its website. On that basis, if it were to fail, Guaranty would be the largest U.S. bank to collapse in 2009. Guaranty is about half the size of IndyMac Bancorp Inc, which failed last July.

This should make for an interesting show, sort of like watching nascar for the crashes?

California Pension Fund Hopes Riskier Bets Will Restore Its Health

Joseph A. Dear, the fund’s new head of investments. He is not an investment seer by training, but he thinks he has the cure for what ails Calpers, or the California Public Employees’ Retirement System, the largest in the nation with $180 billion in assets. Mr. Dear wants to embrace some potentially high-risk investments in hopes of higher returns. He aims to pour billions more into beaten-down private equity and hedge funds. Junk bonds and California real estate also ride high on his list. And then there are timber, commodities and infrastructure.

The riots in Spain should make for interesting TV and youtube… how long can you have 33% unemployment among the younger workers and not end up with serious unrest? they dont have the families, careers, mortgages that the older folks do and provide a negative incentive for unrest amongst the older workers.

When all you have is a backpack, some stupid poster and your laptop, riots start to sound downright entertaining

EU youths hit worst by lack of work

Europe’s youth are bearing the brunt of unemployment created by the economic crisis, according to official data on Thursday that highlighted the risk of the recession leaving a permanent scar on the continent’s younger generation. Joblessness in the European Union has been rising since early last year. But the unemployment rate among 15 to 24-year-olds has been increasing at “a much higher pace” than overall unemployment, according to a study by Eurostat, the EU’s statistical office.

The largest increases were in the Baltic states of Latvia, Estonia and Lithuania, which have been particularly badly hit by the global economic turmoil. But Spain still has the highest youth unemployment rate – with more than a third of the labour force aged 24 or under without work. The latest figures will alarm policymakers as European youth unemployment rates were high even before the economic crisis. They suggested improvements in labour market flexibility in the past decade were at the expense of newer entrants into the workplace – and that companies have reacted to the severe economic downturn by stopping recruitment and ending short-term contracts, rather than dismissing existing staff.

I think that the internet is like electrcity in the early 1900’s, a game changer. some will adapt and survive, others will die.

The quetion i see at the moment is how do we utilize it? the web is capable of much more then youtube and facebook.

There will always be a niche market for brick and mortar, but i think that the level that can exist long term in the presence of the internet is way less then what we currently have. say good bye to the megamalls and to the plague of strip malls that popup like a plague of black mold.

I drive past a number of those horrid strip malls everyday that are half empty at best!

Gator, I despise you for the things you wrote in this thread. The realities of opportunity.

Hawaii.

I lost the vacation lotto this year.
We are off at 6 am for pony penning week and surf fishing.

Our daughter won. Cap’n Barry will be trolling us around crabbing the marshes in our “oldest sneakers.” And we get to ride bikes with carts attached and with bug spray in the baskets! She loves to spray aerosoles.

yo’me @ 345, your numbers don’t make sense. Renting doesn’t cost more than buying. If a house was sold at “break even” as you say (which means “loss” when the associated costs below are included) there is no “equity” by default.

I’ve made no mention of “improvements” but only the basic mandatory expenses associated with carrying and selling a house:

#367 Qwerty
I agree with what you are saying but you dont take on account constant expense which is rent.If you are paying $1300/month on rent and bought a house that your cost is $900/month,you dont call that an equity of $300/month plus deductions and deductions in principal(balance).I dont know what dont make sense.

Those “break even” sellers are too afraid to calculate out their actual losses, instead comforting themselves with “break even” delusions.

How much do you want me to add on all those you mentioned.
1.Realtor fee is $5000
2.property tax is $300 included on $900
3.Opportunity cost- i am saving $300/month
4.Mortgage interest-included on mortgage $600/month
5.Repairs-No repairs DIY
6.Lawn DIY
7 Transaction cost $5,000

property bought cost $100,000
mortgage is $100,000 @ 6% for 30 yrs and sold after 10 years

interest paid is $56,050 balance is $83,504 after 10 years

rent cost is $1300/ month with increases cost $200,000 in 10 years

sold at price bought $100,000
Balance @ $83,504
Total cost you said $15,000 with realtors fee

Abe- I didn’t catch the whole chat just the last few hours- do you live in the north east? Is this an actual prop? I would love to find an investment property for 100k an get those numbers but 1300 a month seems a bit high. I’d say IF you can find something for 100k in Bergen you’d be lucky to get 500 bucks a month and that might be generous.

#370 Cooper the discussion is if you bought a property in 1988 and sold in 1998 you broke even or it is a lost.It is really a property i bought in 1996 and i still have it now.My numbers where $1300/month to rent with comparisson to buy $100,000 property with a mortgage of $600/month and $300/month on property tax equal to $900/month

# 37 0 Cooper
yo’me @ 345, your numbers don’t make sense. Renting doesn’t cost more than buying. If a house was sold at “break even” as you say (which means “loss” when the associated costs below are included) there is no “equity” by default

I’m up in Sparta and I notice there are quite a few listings that are purchase price + realtors fee. I’m figuring most can’t afford what they bought and are trying to get out without a big loss. Some of these are selling which makes me wonder will today’s buyer be in trouble in 2-4 years?

Chinese steel executive beaten to death
By Richard McGregor in Beijing

Published: July 26 2009 11:51 | Last updated: July 26 2009 12:17

An executive of one of China’s largest private steel companies has been beaten to death by workers angry at the threat to their jobs from a takeover of their state-owned firm, according to a Hong Kong rights group.

The violent riot in north-east China late last week involved up to 30,000 workers, a reminder of the ongoing sensitivity about lay-offs from state firms in industries targeted for consolidation.

WASHINGTON — House Democrats want to give doctors a $245 billion sweetener that helps ensure their critical support for a health care overhaul bill. Next up: trying to explain how they could do it without breaking President Barack Obama’s promise that health legislation won’t increase the federal deficit.

“..Toll Brothers Inc., the largest US luxury home builder, has 33 projects on hold. Hovnanian Enterprises Inc., New Jersey’s largest builder, stopped development on 12 initiatives in the second quarter. The Red Bank, New Jersey-based company had 76 shelved developments at the end of April, according to a regulatory filing. Of Hovnanian’s 9,799 mothballed lots, more than 6,100 are in California.”

The Association of American Railroads has begun publishing “Rail Time Indicators,” their monthly look at Rail Transport related data.

Here’s an excerpt from their most recent report:

• Carloads originated on U.S. railroads in June 2009 were down 19.5% (252,078 carloads) from June 2008 to 1,037,928 carloads

• For the first six months of 2009, U.S. rail carloadings were down 19.3% (1,573,998 carloads); intermodal traffic in the first half of 2009 was down 17.0% (950,147 trailers and containers).

“AAR combines rail traffic data with more than 15 key economic indicators (such as consumer confidence, housing starts, and industrial production) in a non-technical snapshot of the U.S. economy. By assembling this information in a single place, and presenting rail traffic in the context of the broader economy, Rail Time Indicators provides a convenient, clear look at the key trends that can reveal where the economy — and, therefore, rail traffic — are going.”

“Freight railroading is a “derived demand” industry — demand for rail service occurs as a result of
demand elsewhere in the economy for the products that railroads haul. Thus, freight rail traffic is a useful economic indicator, both for the overall economy and for specific sub-sectors.”

re minimum wage discussion: you can’t picture a family living on MW without taking into account the earned income credit, which does help a lot apparently. it’s popular with both parties, since it rewards people for working. too bad that w/o jobs that’s irrelevant.

I love gman’s arguments re how densely populated NJ is, and how nothing more can be built. I assure you that Silicon Valley makes NJ look like Wyoming. but this area goes through terrific property booms and busts nonetheless. the people we bought our condo from paid 164K at the height of the bubble-before-last. we paid 122k for it 14 years ago. places like ours were going last year for 350K. so – are we going back down to 164K, or to 122K? with our without inflation adjustment?

oh, shucks, it was kidneys. and I was going to suggest that NJ’s new motto could be “New Jersey is For Livers.” (I know, that dates me and anyone else who gets it).

Forward this link below to the rocket scientists who are claiming prices are rising here. Tell them Gary said: A) Buy now or be priced out forever; B) it’s contained to subprime; C) Use a realtor who is a member of the NAR as they are your friend and are working for you; D) If you’re selling an existing home to buy another, take out a 2nd mortgage on your current home to buy the new home but don’t tell the bank why you’re using the money; E) It’s different here because we have kids that go by the names of Tad, Preston, Graydon, Parker, Brooke, Arabella and Mackenzie.

It’s an open house, it has no appeal, the layout is horrible, there have been no updates, the yard is small, a monthly fee is mandatory for club rights and they’re not going to give you the address to this open house for fear that you may drive by without a realtor present because we all know, a realtor has your best interest at heart and is working for you! ;o Oh, did I mention they’re asking $559,000 for this “home”? Buyers: If you offer anything more than $425,000 for this “charmer”, you need to slapped, open handed, multiple times.

The next time you drive around the state and see some Godawful building project going up where it has np business being built and you ask yourself “How did that ever get approved,” just remind yourself of the arrest this week, and the 130 convictions Christie won.

Calpers, lost nearly $60 billion in the financial markets last year. Though it has more than enough money to make its payments to retirees for many years, it has a serious long-term shortfall.

Those problems now rest largely on the slim shoulders of Joseph A. Dear, the fund’s new head of investments. He is not an investment seer by training, but he thinks he has the cure for what ails Calpers, or the California Public Employees’ Retirement System, the largest in the nation with $180 billion in assets.

Mr. Dear wants to embrace some potentially high-risk investments in hopes of higher returns. He aims to pour billions more into beaten-down private equity and hedge funds. Junk bonds and California real estate also ride high on his list. And then there are timber, commodities and infrastructure.

That’s right, he wants to load up on many of the very assets that have been responsible for the fund’s recent plunge. Calpers’s real estate portfolio has tumbled 35 percent, and its private equity holdings are down 31 percent. What is more, under Mr. Dear’s predecessor, Calpers had to sell stocks in a falling market last year to fulfill calls for cash from its private equity and real estate partnerships. That led to bigger losses in its stock portfolio.

Gov. Arnold Schwarzenegger, who is on the Calpers board, has called the fund “unsustainable.” He has specifically criticized a decision by Calpers last month to give California municipalities a break on their required contributions. Rather than stepping up contribution rates to 5 percent to cover investment losses, Calpers set a maximum increase of 1.1 percent — saving municipalities hundreds of millions of dollars.

Mr. Schwarzenegger called it a “pass the buck to our kids idea.” Calpers says municipalities, which pay 15 percent of their payroll — or about $11 billion a year — into the fund, needed the help.

In the end, Mr. Dear, who will get $408,000 to $612,000 in salary and can qualify for a performance bonus of up to 75 percent of that salary, will be judged by portfolio returns

Interestingly, Mr Dear is following the Hedge Fund “Roll The Dice Model”. For those unfamiliar with how hedge funds operate, many get 2% up front and 20% of the profits. Thus, there is a huge incentive for hedge fund managers to take huge risks as the payouts can be enormous.

For example, imagine managing a billion dollars and doubling it under that model. Dear’s temptation is not as great, but a bonus of 75% on a starting salary of $408,000 to $612,000 is certainly not a bad incentive to take unwarranted extra risks.

Calpers 10-Year rate of return is 2.41%. It’s 20-year rate of return is a respectable 7.75%.

The average yield on 10-year treasuries for the last 10 years is about 4.25% or so. The average yield on 10-year treasuries for the prior 10-year period is roughly 6.5%. Counting capital gains, one could easily have exceeded 7.75% just sitting in treasuries for the last 20 years.

I was looking at one of the houses on sale, and was shocked to see the taxes. A 759K house had property taxes of 16.6K – and this is not the top school district either. That comes to a mill factor of around 2.2%.

Considering the best case scenario – where property taxes rise only 4% per year, This house will sport property taxes of 25k in 10 years time (and still continuously rising thereafter).

Again – I am not sure how this madness is sustainable. Maybe they should give the houses away for free, since the buyer will be beset with heavy property taxes for the rest of his life.

Question for board – how fast (% wise) have the property taxes risen in past in NJ?

Also what about the property tax cap bill that Corzine signed into law? Is that really effective at containing the growth of property taxes to 4% per year?
How has the growth in property taxes looked in last 1-2 years – after that law?

It seems that most of the “bottom” talk is focused on sales volume. This strikes me as a good thing, since, with smaller transactions, one ends up with fewer comp sales and it just slows the rate of the sales-price decline. If people believed the prices were soon to rise, would they not keep the property off th emarket longer or refuse to settle for today’s lower price?

If that house has $1,400 a month in taxes in such shape that the RE agent says “bring contractor” and notes that it is being sold “as is,” can yoy imagine what will happen to the taxes once it is improved?

As it is, taxes nearly equal the likely mortgage payment for someone who puts down 20%.

When I bought my current house in 2001, my taxes were $5,100 per year. Presently, they are $8,200 per year. During that same period, besides property taxes rising like a rocket, the median price for a home in Northern NJ has risen approximately 87%. Meanwhile, over the past 10 years, salaries have risen between 2% to 3% per year or approximately 25% overall, nominally speaking. Think about that, in terms of fundamentals, it was a scam. It was all designed to simply get your money as every deviously designed scheme has done for the last 2000 years.

This is why I become livid when the so-called experts are saying prices are starting to rise. It’s bullsh*t. Pure f*cking bullsh*t from idiots* who are dreaming of the smash and grab days of a few years ago. Forget it. You will see at the very least, years of flat prices as inflation and salaries catch up. It’s the Boa Constricter effect: the victim slowly and painfully gets the life sucked out them until they’re dead.

#404 nynj: Last year yes. This year less, but only because we defered paying into the town pension fund until next year. Next year that shotfall will have to be made up. And by also spending the surplus fund that we had.

I have been checking out the greater-Nanticoke area online. It has REAL potential, with multi-acre waterfront properties at a decent price. I think I am going to take a roadtrip to see one with 20 acres. The House is nothing to look at, but it is the right size and the land is right. I need to check out the taxes.

It ia also a bit of a schlep to the beach, but, if we do an island home for winter months, this area could be a possibility for summer living.

Next year? What is this “next year” about which you speak? There is only today, right? Well, today and hope for a brighter future, full of opportunity, for we live in the greatest metropolitian area ANYWHERE.

Besides the strong draw of family With everything that is wrong with this state from taxes, to corruption, to overcrowding, job losses etc….what keeps most of you here. I am running out of reasons myself.

395.yo’me says:
July 26, 2009 at 10:06 am
The average yield on 10-year treasuries for the last 10 years is about 4.25% or so. The average yield on 10-year treasuries for the prior 10-year period is roughly 6.5%. Counting capital gains, one could easily have exceeded 7.75% just sitting in treasuries for the last 20 years.

yo: I am not insulting you, but rather the analysis. It is stupid. You can take any investment after a tremendous rally and make the same pointless observations (i.e. we are 6 months removed from the strongest Treasury rally of our caeers). Go back 1 year ago and see the same analysis about energy and commodities; before that look at emerging market stocks; before that real estate stocks / REITs; before that internet stocks…..be smarter please….

FYI – in the face of a 30-40% return in many sectors of the equity markets since March 1, check out UST returns…..negative…

Chifi No insult taken.That was part of the analysis in #394.I agree with you.Risk aversion is what i get from the article,not saying there is no risk on UST.I am not smart enough to make those kind of analysis.

[434-436]
If the landlord can’t recoup his costs from rent the business decision is to either sell the income property, or, if he is underwater, to let it foreclose. Bank sells it to the bidder who now could go with lower rent, they have lower income tenants, that repeats itself, and in a few years you get Detroit.

Although the political debate over rent control is far-reaching, as described below, the purposes and provisions of such laws are intended to be limited in scope. They define which rental units are affected, and may have only larger or older rental complexes covered by the law. The frequency and degree of rent increases are limited, usually to the rate of inflation defined by the Consumer Price Index or to a fraction thereof. San Francisco, for example, allows annual rent increases of 60% of the CPI, up to a maximum 7%.[9]

Unregulated rent increases may be allowed when a tenant moves (“vacancy decontrol”). Rent-control laws that don’t include vacancy decontrol are called strong rent-control laws. Such laws were in effect in five California cities (West Hollywood, Santa Monica, Berkeley, East Palo Alto and Cotati) in 1996, when AB 1164 (known as the Costa/Hawkins Bill) made strong rent-control unenforceable in California

Although some opponents contend that rent control decreases housing investment, in reality rent control laws often exempt new construction. For example, San Francisco’s Rent Stabilization Ordinance exempts all units built after 1979.[21] New York State generally exempts units built after 1974 anywhere in the state (although owners can agree to rent stabilization in exchange for tax benefits).[22] In jurisdictions where rent stabilization has exempted new construction for so long, construction trends in more recent decades must be related to other factors (for example zoning and other regulations related to urban planning.
The economic arguments against rent control are often based on its oldest versions, i.e. strong rent control applied to virtually the entire rental housing supply; in many jurisdictions, rent control has since been reformed, for example adding vacancy decontrol and exempting new construction. “Second-generation rent controls are typically mild and so can be expected to have only modest effects on the housing market… As a result, expert opinion on the effects of modern rent control policies has become increasingly agnostic.”[27] Thus, arguments and surveys based on previous versions of rent control may no longer apply to current versions.

Rent control may influence housing investment either positively or negatively, depending on how it affects the local economy and public services (both of which may benefit from retaining key workers), and tax burden (which can increase if rent instability increases turnover among municipal employees), in addition to myriad other voter-driven regulations. If regulation were the only factor driving investment in housing, and if regulation were a purely negative factor, then investment would be highest in the areas with the least regulation, for example desolate rural areas; in fact, the opposite is true, as the largest and most prosperous municipalities tend to have more regulation, including rent control

In older buildings, rent control may actually broaden incentives to renovate individual units: tenants may invest sweat equity and their own money to improve their homes if they are protected from landlords trying to capture the added value,[24],[25] while vacancy decontrol preserves landlords’ financial incentive to renovate vacant units because it allows them to re-rent at market value.

Increases under rent control
Rent increases are also limited to the amounts allowed under a local rent control ordinance if the community has adopted rent control and the rental unit is covered by rent control. More than 100 cities and townships in New Jersey have passed rent control ordinances. To find out if your city or township has rent control and if it covers your unit, you should call your city or township hall. If there is rent control where you live, they will put you in touch with the person in charge of rent control cases. You can then ask for information about your situation and for a copy of the city’s or town’s rent control ordinance. The ordinance will state how much and how often your rent can be raised.

There are two types of rent increases allowed by most rent control ordinances. First, the ordinances allow landlords to automatically increase the rent by a certain percentage each year. This is called the annual increase. Second, the ordinances allow landlords to apply to the rent control board for an increase above the annual amount. This is called a hardship increase.

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Hardship increases. Rent control ordinances allow landlords to apply to the rent control board for a hardship increase. A hardship increase is an additional increase, beyond the regular annual increase, if the landlord is not making a “fair rate of return” or “fair return.” However, courts have said that towns can limit the landlord’s profits to amounts that are fair even if the profits are less than the landlord wants, or less than the landlord could get by investing money elsewhere.

Most rent control ordinances use a formula to determine fair return. These formulas vary. Some fair return formulas are easier to understand than others, and some are more fair to tenants. Check your rent control ordinance for the fair return formula used in your community.

Tenants must be notified if the landlord applies for a hardship increase. The rent control board will then hold a public hearing on the landlord’s request and, after the hearing, make a decision on the request. The rent control hearing gives tenants a chance to contest the rent increase sought in the application.

Institute of Medicine Calls for Doctors to Stop Taking Gifts From Drug Makers

WASHINGTON — In a scolding report, the nation’s most influential medical advisory group said doctors should stop taking much of the money, gifts and free drug samples they routinely accept from drug and device companies.
Skip to next paragraph
Susan Etheridge for The New York Times

The report, by the Institute of Medicine, part of the National Academy of Sciences, is a stinging indictment of many of the most common means by which drug and device makers endear themselves to doctors, medical schools and hospitals.

“It is time for medical schools to end a number of long-accepted relationships and practices that create conflicts of interest, threaten the integrity of their missions and their reputations, and put public trust in jeopardy,” the report concluded.

TORNADO WARNING FOR… NORTHEASTERN MIDDLESEX COUNTY IN NORTHERN NEW JERSEY… SOUTH CENTRAL MORRIS COUNTY IN NORTHERN NEW JERSEY… NORTHERN SOMERSET COUNTY IN NORTHERN NEW JERSEY… THIS INCLUDES THE CITY OF SOMERVILLE… CENTRAL HUNTERDON COUNTY IN NORTHWEST NEW JERSEY…

* OTHER LOCATIONS IN THE WARNING INCLUDE BUT ARE NOT LIMITED TO ANNANDALE… HIGH BRIDGE… LEBANON… WHITE HOUSE STATION… BRIDGEWATER… PEAPACK AND GLADSTONE… MANVILLE… FAR HILLS… MARTINSVILLE… BOUND BROOK… BASKING RIDGE… MIDDLESEX… MILLINGTON… MADISON… COLONIA AND CARTERET

With what goes on around this area, with people rushing to work, rushing to the dry cleaners, rushing to the kids’ practices, rushing home, rushing to pick up bribe money or to visit their mistress(es), or rushing to buy a house before being priced-out forever it is amazing this does not happen more:

AT 520 PM EDT…NATIONAL WEATHER SERVICE DOPPLER RADAR CONTINUED TO
INDICATE A SEVERE THUNDERSTORM CAPABLE OF PRODUCING A TORNADO. THIS
POSSIBLE TORNADO WAS LOCATED NEAR BRIDGEWATER…OR NEAR
SOMERVILLE…MOVING EAST AT 35 MPH.

SEASIDE HEIGHTS, N.J. – Authorities say a 25-year-old former two-time “American Idol” contestant has been struck and killed by a car in a New Jersey shore town.

The Asbury Park Press reports that Alexis Cohen, of Allentown, Pa., was killed early Saturday in Seaside Heights.

Deputy Chief Michael Mohel of the Ocean County Prosecutors Office says an autopsy indicated she suffered chest, head and abdominal injuries. Mohel says investigators are seeking more information about the collision

If you have never been in a place while a tornado is raging overhead, or seen the damage inflicted by one firsthand, it is difficult to fully comprehend how dangerous these storms are.

If you are in the area in question, and you have a basement, you may want to go there and pull the heaviest table you have into a corner and get under it. If you don’t have one, you may want to clear out a small closet in the middle of the house and get in it or better yet get into a bathtub in the smallest bathroom you have and pull something over it.

Shore/X – Re the fixer upper with the crazy taxes – it’s right across the street from a cemetery too. What a “great location”. You can appeal the taxes down before the improvement, but you better believe they will come back up to that (or close to it) after you’ve fixed the place up.

Luckily for anyone who buys it, this is Montclair, and they are probably at least 2 years behind in closing out permits for assessing purposes.

What do you think we’ll be seeing in the dead of winter in terms of prices? I’m hoping there will be a significant drop, but it seems sellers around here (Somerset area) really are digging their heel in and are expecting to get back what they paid in ’06 or ’07.

#473 Ewellie
really are digging their heel in and are expecting to get back what they paid in ‘06 or ‘07.

This underwater sellers can not afford the homes and they don’t have the cash to lower their price.
Their only option is make a deal with the bank on a short sale or walk away in foreclosure.
Just my observation.

NJGator says:
you better believe they will come back up to that (or close to it) after you’ve fixed the place up.

That’s also a busy street. I remember a lot of NYC bus traffic on Mt Hebron Rd.

From 2001 to 2003 I rented a walkout basement apartment in a house on Upper Mtn ave, not far from where this place is. My landlord was trying to appeal his $18,500 taxes. The town asked him if he “really wanted them to come out and re-assess his house” He took that to mean they would probably raise them even higher after going there so he said no, that’s ok. His house was bigger than this place so I’m sure he’s really suckin’ wind right now. The neighbor moved from California for some impressive NYC gig. Six months after buying, they raised her taxes from $14,000 to $20,000. He said he was in her kitchen and she just broke down and started crying.
So much for lifestyles of the rich and famous in Upper Montclair

My question is: why are we playing cup finals with our “B” squad? OTOH, any tournament where a country’s “B” side can make the final should have FIFA pulling the plug. The Gold Cup has become a useless, roster-killing mess.

I understand this is an unusual year, in that there were two major tournaments back-to-back, but we needed 4-5 players with fresh legs available today. Dos Santos and Vela running at backs who had only three days rest yielded a pretty bad result.

I never was on the US bandwagon. I don’t care what team you’re on, you don’t piss away a two goal halftime lead in a cup final.

Sounds harsh, but we had a one of those rare chances to gain some international cred, and we spit the bit vs Brazil. In England, France, Argentina or Italy, that would be viewed as not good enough, and we should view it the same way…or just get comfortable with football remaining a trash sport here.

“Acquiring extra cash is tough these days. Trying to find a job probably won’t help. Your credit card line’s been cut and the idea of a home equity line is a joke.
How about that jalopy in the driveway?

No, we’re not talking about cash for clunkers, we’re talking about an auto equity loan.

Just head on over to Wells Fargo, which proudly advertises that it’s one of the few banks still doing Cash Out Refinance Loans.

In other words, you can refi your car and get cash, just like they used to do with houses. And don’t worry that you have no equity in your car… who does?”

In that kind of market, it was probably wise for Geithner to rent. His last asking price was already $27,000 less than what he paid five years ago for the house. Add in any improvements he made to the home and a broker’s fee — up to $90,000 on a sale like that — and Stiefvater said he could be anywhere from $200,000 to $400,000 in the hole. That’s about the size of his down payment.

“I don’t think anybody’s in a position to say that he overpaid, or anybody overpaid, when he bought his house because market value is market value,” Stiefvater said. “Back in the those days, everybody was overbidding — I’m not saying overpaying, but overbidding — and getting into bidding wars and multiple offers escalated the sale prices to what I think was higher than market value.”